The stock market in the United States is still surging with the Dow Jones setting a fresh record for the fifth straight day.
The Dow Jones closed up 50.22 points at 14,447.29 yesterday while Apple shares jumped by 1.4% to take the S&P 500 very close to its all-time record.
It gained 5.04 to 1,556.22, nine points below its all-time closing high set on October 9, 2007.
When the US stock market first hit its historic highs last week I spoke to some of Australia’s top economists, who predicted the surge would have a positive impact on Australia’s economy and for Australian SMEs.
“We are a small, open economy tied to global conditions so it’s a good news story,” one of them said, “global sentiment is good for local small business; one of the things constraining businesses getting involved and getting finance is negative sentiment.”
But unfortunately, despite the bull run in the United States, confidence is still down amongst our SMEs.
The latest NAB survey published today found that business confidence and conditions are down, despite Wall Street’s bullish turn.
It seems SMEs are looking more at what is actually happening to their business than to global and local equity markets.
And the news still isn’t pretty, with forward orders down at their lowest level since May 2009.
Certain sectors in particular are struggling, like manufacturing, with CSR announcing it is cutting 150 jobs.
Wall Street may be surging but SMEs will continue to be lacking in confidence. Until there is an uptick in forward orders and a turnaround in the patchy business conditions they face on a day-to-day basis.