Leading Indicators Up 0.5% in Nov.

The U.S. index of leading economic indicators rose for the second straight month in November, a sign the recession may end by the middle of next year.

Declining jobless claims, rising stock prices and improved consumer confidence helped fuel a 0.5% increase in the Conference Board’s measure of the economy’s likely direction over the next three to six months. The gain was larger than expected, and followed a rise of 0.1% in October.

Meanwhile, the U.S. trade deficit widened in October to $29.4 billion from $19 billion in September, the Commerce Department reported. Imports were about $11 billion higher in October, roughly the amount of insurance payments from overseas companies after the terrorist attacks.

Imports totaled $106.8 billion, or 14.2% lower than in the same month last year. Exports were $77.3 billion, or 14.5% lower than in October 2000.

The index fits with the view of many analysts that the recession, which began this March, may end by April 2002. The latest Blue Chip Economic Indicators Survey calls for expansion at a 0.4% annual rate in the first quarter of next year, and almost 10 times as fast as that in the second half.

Analysts had expected a 0.4% increase in the November index, according to the median of 38 forecasts in a Bloomberg News survey.

The New York-based Conference Board, a research group, creates the index from eight previously reported economic indicators and estimates for two others.

In addition to claims, stocks and confidence, the index was buoyed by a greater spread between short-term and long-term interest rates. Building permits rose, and the money supply expanded.

The negatives were faster delivery times, a reduction in average weekly hours worked at factories, and fewer expected orders for consumer goods as well as for non-defense capital goods.

The Conference Board’s index of coincident indicators, a measure of current economic activity, fell 0.2% in November.

Personal income remained a positive contributor to that index.