Leading indicators edge higher in April

NEW YORK (AP) _ A private research group's closely watched indicator of future economic activity edged up in April, providing more evidence of a sustained recovery. <br/><br/>The Conference Board said

Thursday, May 20th 2004, 9:55 am

By: News On 6

NEW YORK (AP) _ A private research group's closely watched indicator of future economic activity edged up in April, providing more evidence of a sustained recovery.

The Conference Board said Thursday its Composite Index of Leading Economic Indicators rose 0.1 percent in April, after a revised gain of 0.8 percent the previous month. The latest increase was slightly lower than the 0.2 percent rise forecast by analysts.

The April reading points to ``continued strong economic and job growth through the third quarter,'' said Ken Goldstein, an economist for the Conference Board.

``While there are growing concerns about rising gasoline prices this spring, as well as worries about what happens after all the tax refunds have been spent, the indicators are not signaling any softening in America's basic economic fundamentals,'' he said.

The index is tracked as a measure of the economy's direction during the coming six months. Of the 10 components making up the index, four increased last month, including the real money supply, building permits and stock prices.

In other economic news Thursday, the Labor Department reported that initial claims for unemployment insurance rose by 12,000 to 345,000 last week. That was higher than the 326,000 forecast by analysts. But the more stable, four-week moving average of claims declined to 333,500, the lowest level since November 2000.

The Conference Board also said its gauge of current economic activity continued to strengthen in April, rising 0.3 percent.

At the same time the group's lagging index, which reflects the economic climate in the recent past, increased 0.2 percent last month, following a 0.1 percent dip in March.

The slight rise in the leading indicators in April follows a significant increase in the previous month. The board had originally a reported a 0.3 percent increase, but revised that figure up to 0.8 percent.

During the past six months, the leading index has risen 1.8 percent. While investors are fretting about rising interest rates, the reading shows the higher borrowing costs are not likely to slow growth in the economy or jobs, Goldstein said.

Stocks were higher following release of the report. In morning trading, the Dow Jones industrial average rose 18.03 to 9,955.74. The Standard & Poor's 500 index gained 1.58 to 1,090.26, and the Nasdaq composite index was up 5.74 to 1,903.91.