NEW YORK – Key pillars of the U.S. economy are getting stronger.

The best consumer confidence reading since September 2008’s financial meltdown, along with bullish earnings reports this week from companies ranging from Whirlpool to UPS, show increasing demand and a rebound gathering steam. Americans are even feeling a bit better about the job market.

The biggest remaining worry? Housing. That market has shown signs of strengthening this spring because of government subsidies, but remains on fragile ground and could actually start to weaken once the rebates expire.

Shipping giant UPS said health care companies are sending out more medical devices and high-tech firms are supplying more equipment as business picks up. Cosmetic maker Estee Lauder Cos. said more consumers were buying pricey products, including a $130-an-ounce skin cream.

The Consumer Confidence Index rose in April to 57.9, according to The Conference Board, a private research group based in New York. That’s up from a revised 52.3 in March. Economists surveyed by Thomson Reuters expected 53.5.

The April reading, released Tuesday, is the highest since September 2008’s 61.4, before the index headed into freefall after the bankruptcy of Lehman Brothers and ensuing financial collapse. Still, the reading is well below the 90 that’s considered healthy.

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More consumers in the survey said they planned to buy autos or appliances, but plans to buy homes fell from March, suggesting the housing market remains uncertain and could be a drag on a robust economic recovery.

In fact, the Standard & Poor’s/Case-Shiller home price index showed its first annual increase in more than three years. But the 0.6 percent gain posted in February was half the gain analysts had expected, and many of the metro markets showed declines.

According to the Case-Shiller home price index, 11 of the 20 cities showed declines. The data underscored the mixed and fragile nature of the housing recovery. Nationally, home prices are up more than 3 percent from the bottom in May 2009, but still are 30 percent below the May 2006 peak.

The confidence index — which measures how shoppers feel about business conditions, the job market and the next six months — had been recovering fitfully since hitting an all-time low of 25.3 in February 2009.

Economists believe confidence will remain relatively weak for at least another year because companies haven’t begun to dramatically ramp up hiring.

“I think it is good to see the (confidence) numbers moving up again, but I don’t call it a major change in confidence,” said Gary Thayer, chief economist at Wells Fargo Advisors. “But it does reflect a more optimistic view in the job market.”

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Thayer noted that he still expects a modest economic recovery, citing both weak and strong pockets.

Manufacturing may be showing signs of strengthen, but small businesses, which are typically a big source of hiring, are still struggling as they continue to have a hard time getting credit, he said.

Employers are expected to add 175,000 jobs in April, but economists project unemployment will remain at 9.7 percent.

 


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