Despite a minor uptick this month in consumer spending and slightly improved consumer sentiment, the overall spending environment remains fiercely negative, according to a consumer study from ChangeWave Research (via MarketingCharts).

The results of its January consumer survey suggest spending conditions are stabilizing after a prolonged slowdown. However, it is more likely that this improvement may prove short-lived, similar to what happened after the small May 2008 uptick that occurred as a result of the stimulus tax rebate program.

The combination of a new year, a new presidential administration, and lower inflation are likely contributors to the stabilization seen in the January survey.

Signs of a Tiny Uptick

For the first time since May 2008, there are signs of a consumer spending uptick, though it is very small.While overall spending still looks dismal, the 90-day outlook is not quite as bad as it was in last month's survey (December 2008), the survey found. More than half (57%) of US respondents still say they'll spend less over the next 90 days than they did a year ago, 3 points better than in the December survey. Another 13% say they’ll spend more, 2 points better than previously.

Among US consumers who say they're spending less, reduced income (38%; up 1-point), saving more money (41%; up 2-points) and reducing debt (36%; up 3 points) are the top reasons why.

Over the past 6 months, the percentage of consumers saying they're spending less to save more skyrocketed from 18% to 41%, and the percentage saying they're reducing debt jumped from 24% to 36%, Changewave noted.

A Bounce in Consumer Sentiment

Respondents were also asked about their current impressions of the economy, and - while things still look bad - results weren't quite as dire as they were in December, the survey said.

12% think the economy will improve in the next 90 days, 3 points better than in December. And though 56% think the economy will worsen over the next 90 days - it is a 10-point jump from the December low.Other sentiment indicators also show some improvement:

• 5% of consumers now say they are very satisfied with the current state of their personal finances, up 1 point from the previous record low. Another 39% say they're somewhat satisfied, up 8 points since December.
• 26% say they are now more confident in the U.S. stock market than they were 90 days ago, 13 points better than previously. Only 31% say they’re less confident, a 25-point improvement.

Retail Store Trends

Since February 2007, ChangeWave's consumer surveys have consistently pointed to two retail winners, Wal-Mart (Net Score = +6) and Costco (Net Score=+6). But while both still lead among retail outlets in terms of spending growth over the next 90 days, Costco has experienced a significant drop in its growth rate in the past six months (from +11 in July ’08 to +6 in Jan ’09), the study found.

As in previous surveys, the greatest weakness going forward is among traditional retailers - led by Bed, Bath & Beyond (-14), Sears (-12), Macy’s (-12) and JC Penney (-10).

Home Entertainment Shopping

For the third consecutive survey, Amazon (24%; up 1 point) is the clear momentum leader in home entertainment and networking shopping. The survey also shows encouraging results for Amazon’s electronic reading device, the Kindle, with 2% of respondents saying they've already purchased one, and 58% of current owners saying they're very satisfied with the product.Both Best Buy (37%; down 6 points) and Circuit City (7%; down 2 points) show significant weakness going forward.

Changewave notes there was a similar decline after the 2007 holiday season, but both are considerably lower than a year ago.

In another negative for Best Buy, only 6% say they’ll spend more money there over the next 90 days, 1 point less than last month. Two in five (39%) say they’ll spend no money, a 12-point jump to the highest reading to date.

About the survey: The latest ChangeWave consumer survey of 2,798 US consumers, was conducted Jan 5 - 9, 2009.