US: NFIB Small Business Optimism Index

Tue Jul 14 05:00:00 CDT 2015

Consensus Consensus Range Actual Previous
level 98.3 97.5 to 99.2 94.1 98.3

Small business optimism fell very sharply in June, down 4.2 points to 94.1 with 8 of 10 components falling and pointing to weakness for the second half of the year. Earnings, which were the big strength in May, fell 10 points followed by current job openings and the outlook for company expansion which both fell 5 points. The only gainer in the month was inventory plans which rose sharply. Today's report, like the June employment report, could be a surprise signal for slowing ahead.

Market Consensus Before Announcement
The NFIB small business optimism index has been accelerating with earnings trends and the outlook both on the rise. The index for June, having jumped 1.4 points in May, is expected to hold steady at 98.3.

The small business optimism index is compiled from a survey that is conducted each month by the National Federation of Independent Business (NFIB) of its members. The index is a composite of ten seasonally adjusted components based on questions on the following: plans to increase employment, plans to make capital outlays, plans to increase inventories, expect economy to improve, expect real sales higher, current inventory, current job openings, expected credit conditions, now a good time to expand, and earnings trend.

Small businesses are responsible for a majority of new job creation and the NFIB focuses on this sector of the economy. The direction of the health of small businesses can portend changes in the stock market - especially small caps.