Economic Indicators

Stocks soared again yesterday, building on four weeks of gains, thanks to strong earnings reports from a key retailer and increased investor confidence that the U.S. economy is rebounding and corporate accounting scandals are a thing of the past. "You've got a decent economy, low interest rates, no inflation, a neutral Fed and [a belief that] most corporations are showing legitimate earnings growth through the end of this year," said David L. Berman, head of Berman Financial Group LLC in Timonium.

Economic indicators Thursday: June construction spending, weekly jobless claims Friday: June factory orders, personal income; July unemployment Wednesday Investing in bonds, a seminar presented by A.G. Edwards & Sons, 10 a.m., Suite 205, 4 North Park Drive, Hunt Valley. Free, reservations required. To register, call Mary Burrows at 410-584-8600. Networking social, sponsored by the Towson Business Association, 5 p.m., Charles Village Pub Patio, 19 W. Pennsylvania Ave., Towson. Cost is $30, payable at the door.

WASHINGTON -- The U.S. index of leading economic indicators rose in December for the third straight month, a sign the recession may end by the middle of this year. The 1.2 percent increase in the Conference Board's forecasting gauge, released yesterday, followed gains of 0.8 percent in November and 0.1 percent in October. It was the largest rise since February 1996, when the United States was bouncing back from East Coast snowstorms a month earlier. Three increases in a row in the index mirror other signs of improvement in the economy, now in its first recession in a decade.

If banished to a desert island and allowed only one economic indicator to ply his trade, FinancialOxygen Inc. chief economist Steven A. Wood would use payroll employment figures to make his economic forecasts. If facing the same restrictions, Merrill Lynch & Co. senior economist Gerald D. Cohen would stick with the yield curve, which hints at the economy's future with the changing relationship between short- and long-term interest rates. Interestingly, neither would rely upon the index of leading economic indicators, which was released yesterday.

Two new reports yesterday indicated continuing strength in the U.S. economy, increasing the likelihood that the Federal Reserve will keep raising interest rates in an attempt to slow growth. A widely watched predictor signaled that the economic expansion, now in a record 110th month, would continue well into the year; a second report showed sales of new single-family homes surged in March to their fastest pace in 18 months despite rising mortgage rates. The predictor, the Index of Leading Indicators, rose 0.1 percent in March after falling 0.3 percent in February, the Conference Board said.

Federal Reserve policy-makers, concerned that a shortage of workers and a scorching economy will touch off inflation, raised a key interest rate a quarter-point to 5.75 percent yesterday -- an action that was anticipated and that economists believe presages further rate increases to keep the record economic expansion humming. "I think this is the right thing to do to prolong growth in an economic expansion that's now 107 months old," said Philip J. Schettewi, senior managing director of Newark, N.J.-based Prudential Global Asset Management, which oversees $100 billion.

NEW YORK -- A barometer measuring U.S. economic growth improved for the third straight month during March, paced by stock market gains.The Conference Board's Index of Leading Economic Indicators, designed to be a predictor of activity over the next half-year, rose 0.2 percent in March after climbing an unrevised 0.4 percent in February and 0.1 percent in January."

WASHINGTON -- The U.S. economic indicators -- a composite index intended to project growth over the next half-year -- rose in November, the fifth consecutive advance and a sign that 1998 will start on sound footing.The Conference Board reported yesterday that it's index climbed 0.1 percent in November after rising an unrevised 0.1 percent in October. Of the 10 previously released indicators, four made a positive contribution in November, with manufacturers' orders for capital goods accounting for the bulk of the gain.