Consumer spending, which makes up two-thirds of economic activity, slowed last month and could slow further. More evidence will come in the next 2 weeks when economists see the key unemployment, consumer confidence, new home sales and durable goods numbers. If they support Tuesday's reports, optimism may be well placed. There has never been a recession in the USA when housing has been strong. House hunters could disappear, though, if consumer confidence weakens.
Investors are more bullish.
Despite that, the Nasdaq composite index ended Tuesday up 14 points at 1923, and the Dow Jones industrial average rose 58 to 10,217. The equity markets are showing clear signs of a bottom.