Another report today showed the number of Americans filing applications for unemployment benefits last week held near the lowest level in almost four months, a sign the labor market is firming. Jobless claims increased by 5,000 to 320,000 in the week ended March 15, according to figures from the Labor Department. The four-week average, a less volatile measure, fell to the lowest level since late November.

Shares fall

Stocks declined, sending equities to a second day of losses, after Federal Reserve Chair Janet Yellen signaled interest rates may rise by the middle of next year. The Standard & Poor's 500 Index dropped 0.1 percent to 1,858.61 at 9:44 a.m. in New York.

Twenty-four percent of households surveyed this month projected the economy would improve, the fewest since November, the comfort index showed. The share of consumers with negative expectations rose to 36 percent from 30 percent in February.

The weekly comfort figures showed measures of consumers' personal finances and economic conditions declined in the period ended March 16, while more Americans than at any time in the past two months said it was a good time to buy.

The gauge of personal finances dropped to 0.7, the lowest level in four months, from 4.3 a week before. The index of consumers' views on current economic conditions declined for the first time in six weeks, falling to minus 49.6 from a seven- month high of minus 48 a week before.

Buying plans

The share of Americans saying it's a good time to buy rose minus 38.1 from minus 39.3 in the prior period.

Rising energy and food prices are probably weighing on consumer attitudes. The average price of a gallon of regular gasoline was $3.53 as of March 18, the highest since September, according to AAA, the biggest U.S. motoring group. Food costs climbed 0.4 percent in February, the most since September 2011, figures from the Labor Department showed this week.

At the same time, total consumer prices were little changed last month as clothing, furniture and used-auto retailers cut prices to lure customers back following the harsh weather.

Regionally, the confidence figures reflected the effects of the bad conditions as sentiment declined in the Northeast and Midwest last week. The comfort reading in the South rose to an almost six-month high.

The sentiment index for Americans making less than $15,000 a year dropped for the first time in six weeks, while at the opposite end of the pay scale, confidence was unchanged for those making more than $100,000 a year.

Job gains

A slowly healing job market will probably help Americans cope. Employment grew by a larger-than-projected 175,000 in February, Labor Department figures showed this month, showing employers are confident the economy will pick up after winter storms curbed consumer spending.

Hourly earnings adjusted for inflation climbed 0.3 percent in February, the biggest gain since April, a Labor Department report showed this week. They were up 1.1 percent over the past year.

Businesses such as Minneapolis, Minnesota-based General Mills, maker of Yoplait yogurt and Cheerios cereal, could get a boost with further gains in the job market and more seasonable temperatures.

"In the short-term, we're coming off a very severe winter and so we are already seeing our categories strengthen a little bit as we get through that," Ken Powell, the company's chairman and chief executive officer, said in a March 19 earnings call. "As incomes continue to grow and consumers gain confidence, that will be a positive sign for our category."

Fed action

Federal Reserve policy makers yesterday said they'll reduce monthly bond purchases to $55 billion in April as the economy continues to improve.

"The committee's actions today reflect its assessment that progress in the labor market is continuing but that much remains to be done on both the jobs and inflation fronts," Fed Chair Janet Yellen said in a news conference.

This month's consumer expectations readings showed a political divide, as 46 percent of Democrats saw the economy improving, compared with 12 percent of Republicans and 17 percent of independents.

The Bloomberg Consumer Comfort Index conducts telephone surveys with a random sample of 1,000 consumers ages 18 and older. Each week, 250 respondents are asked for their views on the U.S. economy, personal finances and buying climate. The margin of error for the headline figure is 3 percentage points.

The percentage of negative responses is subtracted from the share of positive views and divided by three. The most recent reading is based on the average of responses over the previous four weeks.

The comfort index can range from 100, indicating every participant in the survey had a positive response to all three components, to minus 100, signaling all views were negative.

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