This morning, the National Federation of Independent Business (NFIB) released their latest Small Business Optimism Index results, showing a rise of over 2 points to 93.7—surpassing consensus expectations and marking the highest level since February 2022.
Small businesses are the backbone of job creation in the United States and are vital to our overall economy. While today’s data is encouraging, it’s important to note that small business optimism remains below its historical average. However, looking at past trends, when the index has been below average but trending upward, like it has since June, forward 12-month stock market returns have historically been strong—showing positive returns in every instance (see table below).
Though the NFIB index isn’t a standalone trading signal, it provides insight that can bolster investor confidence in a volatile market.
