Ahead Of The Bell: Retail Sales

WASHINGTON (AP) — Retail sales likely rose in May after falling for two straight months, amid signs that the worst of the recession may have passed.

Wall Street economists surveyed by Thomson Reuters expect retail sales increased 0.5 percent in May, compared with declines of 0.4 percent in April and 1.1 percent in March. The Commerce Department is scheduled to release the report Thursday at 8:30 a.m. EDT.

Retail sales increased in January and February after falling for six straight months, raising hopes that the economy's crucial consumer sector may be stabilizing. The setbacks in March and April clouded that prospect. With many families saving more and spending less, worried about layoffs and shrunken home equity and retirement accounts, the start of a sustained recovery appeared to be delayed.

Now consumer confidence appears to be rebounding. The Conference Board's Consumer Confidence Index for May rose to its highest level since September.

A Federal Reserve snapshot of economic conditions issued Wednesday found that five of the central bank's 12 regions said the economy's downward trend "is showing signs of moderating," and hopes for future business activity improved.