Consumer Confidence Surges, Markets Rebound

Consumer confidence jumped more than 3 points this month, reaching a two-year high and providing a sign that the economy might be in for another burst of growth.

The news was enough to send the bulls running on Wall Street, driving the Dow up by triple digits and ending a lengthy skew of losing or flat sessions that had sent the Dow to a two-month low and left the Nasdaq at its lowest level since last fall.

The Dow gained 123.22 points to close at 10,085.14. The Nasdaq gained 30.08, more than 1.5 percent, finishing the session at 1,869.10, and the S&P 500 climbed 10.76 points to 1,094.83.

Home Sales

The Conference Board survey of consumers found increasing optimism about the overall economy and individual job prospects.

The index rose to 106.1 for July, up more than 3 points from June. It was the fourth straight month the index has climbed, and it marked the highest reading the index has seen since June of 2002.

The confidence number was supported by a Commerce Department report showing that new home sales, while down, slid only .8 percent in June, less than forecast by most economists.

Earnings Upside

Also helping the markets were several strong earnings reports.

Verizon beat earnings and revenue estimates for its second quarter, while Automatic Data Processing and Omnicom were among a handful of other companies to top expectations in their second quarter reports.

There was still a smattering of bad earnings news, however. Nortel Networks lost 15 percent after warning it would have shrinking profit margins despite strong growth for the rest of the year.

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