WRAPUP 2-U.S. consumer confidence, home prices edge up

* Confidence rises to 53.5 in Aug from 51.0 in July

* Home price index up 0.3 percent in June from May

* Chicago PMI index at 56.7 in August vs 62.3 in July
(Updates with quotes, details)

By Caroline Valetkevitch

NEW YORK, Aug 31 (BestGrowthStock) – U.S. consumer confidence rose
modestly in August and U.S. homes prices gained more than
expected in June, easing some worries the economy is headed for
another downturn soon.

Another report released on Tuesday showed the pace of
growth in business activity in the U.S. Midwest slowed in
August, but economists said the data overall did not present
new worries about the path of the economy.

The data shows “the economy, while it is not going on all
cylinders, is also not sliding into this double-dip recession
that people are concerned about,” said Eric Kuby, chief
investment officer at North Star Investment Management Corp in

Financial markets, however, were reluctant to read too much
into the numbers, particularly as investors awaited the release
on Friday of the government’s closely watched monthly report on
the U.S. labor market.

Tuesday’s mostly upbeat data follows a slew of
disappointing economic reports in recent weeks.

The Conference Board, an industry group, on Tuesday said
its index of U.S. consumer attitudes, seen as a gauge of
consumer spending, rose to 53.5 in August from an upwardly
revised 51.0 in July. For details, see [ID:nN31236324]

The median of forecasts from analysts polled by Reuters was
for a reading of 50.5. Forecasts ranged from 47.5 to 55.0.

Consumer spending typically accounts for about two-thirds
of U.S. economic activity and is considered critical to the

U.S. stocks (Read more about the stock market today. ) (.SPX: ) were higher after the data in choppy
trade. U.S. Treasury debt prices (US10YT=RR: ) were also higher,
but pared some gains after the reports, while the U.S. dollar
(JPY=: ) was down against the yen, though it received some
support from the data.

Also supporting the view that the economy is not headed for
another major downturn, U.S. bank regulator Sheila Bair said in
a quarterly briefing that while the recovery is sluggish, she
does not anticipate a double-dip recession in the United
States. [ID:nWAT014615]

Friday’s jobs report is forecast by economists in a Reuters
poll to show non-farm payrolls declined by 100,000 in August
and the unemployment rate rose to 9.6 percent, from 9.5 percent
in July.


For a graphic on consumer confidence click on:


For a graphic on home prices click on:


For a graphic on Midwest manufacturing click on:


For Reuters Insider on S&P Housing Report click on:




In another encouraging sign for the economy, prices of U.S.
single-family homes gained more than expected in June and rose
in the second quarter. The S&P/Case Shiller composite index of
20 metropolitan areas rose 0.3 percent in June from May on a
seasonally adjusted basis.

The rise was better than the 0.2 percent increase expected
by economists polled by Reuters, though slower than May’s 0.5
percent rise.

The gain, however, likely reflected the lingering boost
from homebuyer tax credits that ended in April, and economists
agree the effects of buyer tax credits have largely filtered
through. They say home prices will be hard-pressed to sustain
these gains with unemployment still near 10 percent.

Still, the data suggested a positive trend.

“We’ve seen in most of the government data as well that
pricing is stabilizing or slightly improving,” said Tim
Ghriskey, chief investment officer at Solaris Asset Management
in Bedford Hills, New York.

Also on Tuesday, the Institute for Supply
Management-Chicago said its business barometer dropped to 56.7
in August. The reading was 62.3 in July, and economists had
forecast an August reading of 57.

The employment component of the index fell to 55.5 from
56.6 in July. New orders fell to 55.0, from 64.6. A reading
above 50 indicates expansion in the regional economy.

Separately, the Federal Deposit Insurance Corp. said that
problem loans fell in the second quarter for the first time in
four years.
(Additional reporting by Lynn Adler, Ann Saphir, Edward Krudy,
John Parry and Wanfeng Zhou; Editing by Leslie Adler)

WRAPUP 2-U.S. consumer confidence, home prices edge up