A big uptick in consumer-confidence data and a handful of improved earnings reports helped shake buyers out of their summer siesta, sending the Dow industrials solidly back above 10000 Tuesday. After three days of selling, the Dow Jones Industrial Average climbed 123.22, or 1.2%, to 10085.14, bolstered by big gains in Verizon Communications. The Nasdaq Composite Index grew 30.08, or 1.6%, to 1869.10 and the S&P 500-stock index rose 10.76, or 1%, to 1094.83. Treasury prices tumbled. Consumers' view of the economy hit its highest reading in more than two years, lifted by improving conditions in the labor market. The Conference Board, a private research group, said its index of consumer confidence in July moved to a better-than-expected 106.1 after rising to a revised 102.8 the month before (see chart on right).

The July reading was the best since June 2002, and beat economists' expectations of 102.2. "The spring turnaround has been fueled by gains in employment, and unless the job market sours, consumer confidence should continue to post solid numbers," said Conference Board economist Lynn Franco. Some market watchers said the report indicated good things about consumer spending going forward, and that what appeared to be a soft patch last month may have just been temporary. "With some of the exogenous negative events -- most notably, the Iraq prison abuse scandal and the gasoline price spike -- that dampened optimism behind us, the steadily improving economic fundamentals are leading to an uptrend in confidence that seems to be gathering momentum in June and July," said Steve Stanley, chief economist at RBS Greenwich Capital in Greenwich, Conn. "The consumer is not nearly as fragile as some analysts are suggesting."

Source: Wall Street Journal online