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  • Four new reports show stronger U.S. economy

    Consumer confidence highest in 5 years
  • WASHINGTON — The U.S. housing recovery is strengthening. Factories are fielding more orders. And Americans' confidence in the economy has reached its highest point in 51/2; years.
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  • WASHINGTON — The U.S. housing recovery is strengthening. Factories are fielding more orders. And Americans' confidence in the economy has reached its highest point in 51/2; years.
    That brightening picture, captured in four reports Tuesday, suggests that the economy could accelerate in the second half of the year. It underscores the message last week from the Federal Reserve, which plans to slow its bond-buying program this year and end it next year if the economy continues to strengthen. The Fed's bond purchases have helped keep long-term interest rates low.
    Investors appeared to welcome the flurry of positive data. The Dow Jones industrial average rose 100 points to close at 14,760, and broader stock indexes also ended the day up. Those gains made up only a fraction of the markets' losses since Chairman Ben Bernanke said last week that the Fed will likely scale back its economic stimulus within months — a move that would send long-term rates up.
    But the rising confidence of U.S. consumers shows that most Americans are focused on a better job market, said Beth Ann Bovino, chief economist at Standard & Poor's.
    "Maybe households agree with the Fed: the economy is improving," Bovino said.
    The Conference Board said its consumer confidence index jumped this month to 81.4, the highest reading since January 2008.
    For most Americans, the biggest investment is their home. And a steady rise in prices is allowing them to recover much of the wealth they lost during and immediately after the Great Recession.
    U.S. home prices jumped 12.1 percent in April compared with a year ago, according to the Standard & Poor's/Case-Shiller 20-city home price index. That was the biggest year-over-year gain since March 2006.
    More buyers and a limited supply of available homes have lifted prices in most cities. Higher prices have, in turn, fueled further sales and encouraged builders to ramp up construction.
    Sales of new homes rose in May to a seasonally adjusted annual rate of 476,000, the Commerce Department said. That was the fastest pace since July 2008. Though sales of new homes remain below the 700,000 annual rate that most economists consider healthy, the pace has jumped 29 percent from a year ago.
    The weakest part of the economy this year has been manufacturing, which has been held back by a recession in Europe and tepid growth in other overseas markets. But factory activity may start to rebound, according to a report from the Commerce Department. The department said orders for durable goods rose 3.6 percent.
    Most of the increase was because of commercial aircraft orders, which tend to fluctuate sharply from month to month. Still, businesses also ordered more computers, communications equipment, machinery and metals.
    As a result, a category of orders that's viewed as a proxy for business investment plans — which excludes the volatile sectors of transportation and defense — rose 1.1 percent. That matched similar gains in April and March. This category hadn't risen for three straight months since 2011.
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