After a boatload of earnings and two very rough trading sessions, the major equity indices are finally getting some reprieve and are trading back in positive territory for the year. Economic data around the world was mixed, but for the most part their stock markets reflected our own. Gold remains well below the $1,200-level and despite declining during today’s session the price of oil remains just under $59 per barrel. The dollar still remains strong, but gains in some foreign currencies might change in the coming months.

There’s a whole slew of domestic economic data driving the market higher this morning, however the details are mixed. Firstly, spending in the construction sector once again missed consensus expectations. For the month of March, construction spending dropped 0.6% over the prior month while economists expected a 0.4% increase. Over last year, construction spending was up 2.0%, but down from February’s annual increase of 2.7%. However, construction in both residential buildings and public buildings declined for the month. While we can still blame the weather for some of the decline, there is still an apparent weakness among builders. Private residential spending dropped 1.6% on the month as both single family and multi-family homes declined. In addition, residential construction excluding new homes, which includes the home remodeling sector, also declined after gaining ground in the last two months. However, nonresidential private construction actually showed some sign of hope as it advanced 1.0% for the month on gains in the office, manufacturing, and health care sectors. Public sector construction was down for a third straight month, although this is less watched by economists as it usually reflects the spending action of government and not consumers.

Next, the Federal Reserve noted on Wednesday that consumer confidence is strong, and this is confirmed by the University of Michigan’s consumer sentiment index, which showed an unchanged final reading of 95.9 for April, substantially higher than the 93.0 final reading for March. The index’s two components, current conditions and expectations, both showed gains with readings of 107.0 and 88.8, respectively. The current conditions component points to month-over-month strength in consumer activity, while the expectations component points to confidence in income outlook. Inflation expectations are very weak in this report as well, reflecting the low level of gas prices which have actually been on the rise in recent weeks. The 1-year outlook for inflation is at 2.6%, down from 3.0% in March. Policy makers will keep a close eye on the consumer inflation expectations, although the report won’t give the Fed any ammo for raising interest rates. Once again, it is interesting to see that despite the overall strength in sentiment, consumers have yet to pick up the pace in spending.

Lastly, the Institute for Supply Management (ISM) noted an unwanted wrinkle in the April manufacturing purchasing managers index (PMI). For the month, ISM noted that weakness in the employment component held down the headline reading of 51.5, which is unchanged from March. While the employment component has been notably stronger in other reports, the ISM number shows the index down nearly 2 points into contractionary territory at 48.3. This is the first time this reading has shown a contraction since May 2013 and it’s the lowest reading since all the way back to September 2009. All other indicators were positive for the month, notably new orders increased by 1.7 points to 53.5 and export orders were above the 50-level for the first time this year at 51.5 – a 4.0 point gain. Production is also strong at 56.0, while prices, as in other reports, remains in a contractionary phase at 40.5. The majority of the industries covered showed growth during the month, with the auto industry showing particular strength. However, the weak reading in employment is a big point of concern going into the April jobs report.