Positive surprises fuel equity rally

A decline in negative surprises is possibly fueling the stock rally, but the data is sensitive to the form that the index takes. The index still is in negative territory but is moving higher which, of course, is good for the markets. The housing and real estate sectors are showing positive surprises, but this is the sector that has seen some of the worst expectations.Business cycle indicators are still suggesting a slowdown, so signals are somewhat mixed.

Watching the surprise index may suggest that the worst is over for the US economy.