Home resales jumped more than expected in December despite bad weather as sellers cut prices, offering some hope for a sector that has been struggling to recover from its worst slump in modern history.

Factory activity growth in the U.S. Mid-Atlantic region fell in January from December's level, a survey showed.

The economic recovery is broadening and could strengthen slightly in the near term, according to a private industry group's index of economic indicators released on Thursday.

COMMENTS:

MARK VITNER, SENIOR ECONOMIST, WELLS FARGO SECURITIES, CHARLOTTE, NORTH CAROLINA:

It is a little surprising we saw such a big increase in existing home sales, but it is quite possible this reflects foreclosed properties and short sales. Banks likely wanted them off their books toward the end of year. There does not seem to be a whole lot of momentum in housing sector and we will not see much improvement until we move past this mountain of foreclosures. High level of sales look good on surface, but these properties are mostly being bought by investors and not true demand.

The Philly Fed is still a relatively high level. The big story is the prices paid index and this mostly reflects higher energy prices. It has recently been driven by exports, so this does not create jobs. This leaves the economy vulnerable to events overseas, but overall it is a good thing it is export driven and should result in surprisingly robust fourth quarter GDP, possibly adding 1.5 percent.

People should get a good idea what the recovery is going to look like from today's data. Conditions will likely be the same over next couple of years with a modest 3 percent GDP. Improvement in the labor market will be painfully slow.

PAUL LARSON, EQUITIES STRATEGIST, MORNINGSTAR, CHICAGO:

You have to take the home sales number with a grain of salt. We have a lot of foreclosures moving through the pipeline, and since those don't play by rules of seasonality they can skew numbers. I don't want to read too much into it.

The most important data point out today is the claims number. We had a blip up last week but now we've gained all that back and then some. It looks like the blip was caused by temporary seasonal workers.

KATHY LIEN, DIRECTOR OF RESEARCH, GFT FOREX, NEW YORK:

Most of the reports today were fairly good. For anyone skeptical about the U.S. recovery, these should ease concern. The Philly Fed manufacturing data was slightly weaker but it's been doing well in recent months. Existing home sales was very solid and leading indicators increased more than the market expected. It suggests the U.S. economy is moving in the right direction and investors are buying the dollar, as there are concerns outside U.S. borders. The combination of strong U.S. and Chinese data today is something to be optimistic about.

ZACH PANDL, U.S. ECONOMIST, NOMURA SECURITIES, NEW YORK:

I think the improvement in the existing home sales obviously contrasts with the weak homebuilding report yesterday and suggests that the housing market recovery is ongoing.

The housing recovery is proceeding in fits and starts, but still a reasonable volume of sales activity in the market. You've fully recovered from the post-tax credit bust and now these numbers suggest you are in a more expansion path.

With regard to the Philly Fed number, the manufacturing indicators are suggesting, overall, that these sectors are continuing to see strong growth into 2011 and you should see a very strong ISM number in February.

MARKET REACTION: STOCKS: U.S. stocks slightly pare losses after the data. BONDS: U.S. Treasury bond prices extend losses. FOREX: The dollar extends gains versus the yen.