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I’m seeing growing negativity on the U.S. economy and on the timing and depth of a U.S. recession.

I think it’s important to note that the stock market and the economy aren’t perfectly correlated. Stocks can go up even as the economy weakens on things like sentiment about the pace of Federal Reserve interest rate cuts, for example, or just in reaction to an oversold condition in the financial markets.

But an increase in negative sentiment about the economy certainly increases the odds of a downturn in stocks. And makes stocks more risky.

And right now I’m seeing the emergence of very negative sentiment on consumer spending on services ranging from restaurants to hotels to travel. I think the summer rally in segments such as airlines that I’ve been looking for is becoming less likely.

I’m going to begin trimming the positions I put on for just such a summer rally move.

Retail sales slowed last month for the first time this year, driven by a 4% drop in car sales. U.S. flight bookings dipped 2.3% in May from a month earlier, according to Adobe Analytics. And both high- and low-income Americans have begun pulling back, particularly on services, in the past four to six weeks, according to an analysis of credit card data by Barclays, the Washington Post reports. The slowdown in spending is now concentrated in services, not goods, the bank found in a new analysis of credit card data. Spending on services like travel and restaurants, which was growing at a rate above 30% from 2021 levels in 2022, has now slowed to half that pace, according to Barclays. Overall, flight searches on booking site Kayak are down an average 13% so far this month, compared with the same period 2019. Restaurant dining data from the reservation platform Open Table shows that the number of people eating at restaurants fell 11% in the week ending June 16, compared with the same week in 2019.

The Purchasing Managers Index for Services from the Institute for Supply Management for services slowed in May to its lowest level since February 2021.