By Carlos Guillen

After yesterday's rather moderate retreat in equity markets, today is turning out to be a complete about-face as overall economic data points presented earlier in the session have helped to pull investors out of the sidelines and into stocks. As such, equity markets are continuing their ascent, currently sending the Dow Jones Industrial Average to its third record intra-day high this week, putting the index on track for yet another record closing level today.

Quite encouraging today was that consumer sentiment not only landed higher than expected but also reversed its negative direction from last month. The University of Michigan's Consumer Sentiment May result landed at 83.7, which was higher than the Street's expectation of 78.5, increasing from the 76.4 reached in April and reaching the highest level since July 2007 when it was 90.4. Given the close relation between consumer sentiment and consumer spending, this sudden jump in sentiment may revive hopes that consumption may grow at a faster rate this quarter. As it stands, according to the most recent government data, personal consumption expenditures increased quarter-over-quarter by 3.2 percent in the first quarter, the most since the fourth quarter of 2010 when it was 4.1 percent. The strong growth in consumption coincided with the strong ramp in sentiment during the first three months of this year, and the overall uptrend is still in motion. Putting the icing on the cake, the index of expectations six-months from now, which more closely projects the direction of consumer spending, rose to 74.8 in May from 67.8 the month before.

Another encouraging bit of economic data was that the indexes of leading indicators improved and still appears to be maintaining a favorable short-term uptrend, signaling that an overall stronger housing and jobs markets are helping the U.S. economy make more progress in the first half of 2013. According to the Conference Board, its Leading Economic Index (LEI) during April increased month-over-month by 0.6 percent to 95.0, better than the Street's consensus estimate calling for a 0.3 percent month-over-month rise. Also favorable was that of the ten components that make up the leading indicator, 7 were positive in April compared to 5 positive components in the prior month. The three top contributors were building permits, the interest rate spread, and average weekly initial claims for unemployment insurance. The slow but still overall up-trending results are indicating that the recovery is still alive.

In all, the economic snapshot presented today has served to invigorate investors who though the market was running out of steam. While most of this week stock's were fueled by increasing confidence that the Fed would continue on its easy money trajectory, today the market's action was finally fueled by true encouraging data for a change, and it is lifting the Dow to record highs … these stocks are on fire!