Prepare to be confused and confounded. In a blissful and virtuous circle, the US stockmarket rallied overnight on Tuesday, reflecting the general rise in consumer confidence. Indeed, the Conference Board measure of US consumer confidence rose to a five-year high of 76.2 in May, from 69.0.
And why is confidence rising? One of the reasons cited by economists and others is the continued rally in equity prices. Nice! The stockmarket goes up because confidence has risen, and confidence has risen because the stockmarket has gone up.