This is better. Exchange traded funds (ETFs) are showing large gains on Monday after data showed a rise in both personal income and consumer spending in January.

  • Government data showed that consumer spending rose less than expected in January as households took advantage of the largest increase in incomes in more than 1-1/2 years to rebuild their savings. While the modest increase in spending, which accounts for 70%  of economic activity, likely reflected some weather effects it also suggested spending would slow down after growing briskly in the final three months of 2010. The Commerce Department said spending edged up 0.2%, the smallest increase in seven straight months of gains, after an upwardly revised 0.5% rise in December. The Direxion Daily Retail Bear 2x Shares (NYSEArca: RETS) is up 0.6% so far today.
  • A measure of Chicago-area manufacturing accelerated at a faster-than-expected pace in February. The Chicago business barometer rose to 71.2 from 68.8 in January, a reading above the 67.7 forecast by economists. The reading fell just below the 71.5 hit in July 1988. The big jump was led by a rise in production, though employment eased slightly from its high in January, to 59.8. Any reading above 50 indicates expansion. The SPDR S&P International Industrial Sector ETF (NYSEArca: IPN) rose approx 1.5% today.
  • Fewer Americans signed contracts to buy homes in January, the latest evidence that the housing market is struggling. The National Association of Realtors says its index of sales agreements for previously occupied homes fell 2.8 percent last month to a reading of 88.9, the second straight monthly decline. Sales of previously owned homes fell last year to the lowest level in 13 years. Economists say it will be years before the housing market fully recovers. High unemployment and a record number of foreclosures are deterring potential buyers, who fear home prices haven’t reached the bottom. SPDR S&P Homebuilders (NYSEArca: XHB) is flat so far this morning.
  • The U.S. dollar erased early gains versus major rivals Monday, resuming its recent downtrend as the Euro was propelled higher ahead of this week’s meeting of European Central Bank policy makers. “Although investors are concerned about political turbulence in the Middle East, they also think that the U.S. dollar may not be the best safe haven for these particular circumstances, given the U.S.’s exposure to higher oil prices and politics in the Middle East,” said analysts at Barclays Capital. PowerShares DB U.S. Dollar Bearish (NYSEArca: UDN) is up slightly so far today.

Gregory A. Clay contributed to this article.

The opinions and forecasts expressed herein are solely those of Tom Lydon, and may not actually come to pass. Information on this site should not be used or construed as an offer to sell, a solicitation of an offer to buy, or a recommendation for any product.