Consumer optimism rebounds after drop

Consumer sentiment stabilized in December after a steep decline in November. The RBC CASH Index increased to 65.9 in December, compared to a reading of 64.0 in November. The October reading was 80.6. "The U.S. consumer is going into this holiday season with a level commensurate with the level after Hurricane Katrina," said T.J. Marta, fixed income and economic strategist at RBC Capital Markets in New York. The Expectations Index increased more than 12 points to a reading of 7.9, up from a reading of -4.3 last month. The Jobs Index inched up more than two points to reaching 113.9, compared to reading of 111.8 in November. The Current Conditions Index fell nearly five points to a reading of 85.3, down from November's reading of 90.3. The Investment Index, which measures consumers' views of the investment climate, fell to 79.7, compared to reading of 83.4 last month. The survey was based on a sample of 1,009 U.S. adults polled between Dec. 3 and Dec. 5. In another report, the Reuters/University of Michigan Surveys of Consumers, consumer sentiment fell to 74.5 in December, down from a reading of 76.1 last month, according to published reports. The reading was the second lowest since the Oct. 2005, when the index fell to 74.2 following Hurricane Katrina.