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For those who expect a brutal jobs market and a nervous consumer to threaten the economic recovery this year, a rally in the retail sector is a surprising bright spot.

Even with the market’s most recent run up, the Dow Jones industrial average has gained a modest 3% year to date, while the S&P 500 is up just 4% and the Nasdaq composite has risen a mere 4.6%.

Meanwhile, the retail sector has been staging a stealth rally, with the S&P Retail (RLX) index jumping more than 8% from the start of the year and the Morgan Stanley retail index surging more than 14%. Individual stocks have been even more buoyant, with many of the best performers in the S&P 500, the S&P MidCap 400 and S&P SmallCap 600 coming from the retail sector.

"I think it has to be seen as a good sign," said Bernard McGinn, chief executive of McGinn Investment Management.

He said the stock gains suggest that retailers have become more efficient since the recession. And that has translated into improving sales and profits. On top of that, consumers are starting to loosen their purse strings.

"They’re not spending anywhere near the levels of three years ago, but they are spending more than we thought they would," he said.

A perception that the sector is stabilizing and that the economic recovery will pick up later in the year has brought in some big buyers. But many investors remain wary of the buoyancy in the retail sector amid bets that the current pickup in spending can’t last, particularly with unemployment continuing to rise.

"The gains in consumer discretionary and the retail sector mean people are banking on a powerful recovery that we don’t think is going to happen," said Ben Halliburton, chief investment officer at Tradition Capital Management.

He said he’d rather be in the consumer staples sector because those stocks have a global presence and aren’t tied to the U.S. consumer. Some of the year-to-date winners in that sector include Tyson Foods (TSN, Fortune 500) (+42%), Dr Pepper Snapple Group (DPS, Fortune 500) (+24%) and PepsiCo (PEP, Fortune 500) (+9%).

The fact that many individual investors are unwilling to jump into the retail sector with both feet could also be seen as a positive indicator, from a contrarian viewpoint no fax cash advances.

"Retailers are up a lot, but the overall sentiment is negative and a lot of people are still betting against the stocks," said Ryan Detrick, senior technical strategist at Schaeffer’s Investment Research.

"When you have something helping to lead the market higher yet people are throwing their hands up, that can be a good thing," he explained. "That skepticism can keep driving the stocks higher."

Sales drive stock growth

Still, improving store sales have been translating into share growth for many of the nation’s largest publicly-traded retailers.

December and January same-store sales rose by a larger than expected pace, significant as the two months include the critical holiday period. Easter sales are also expected to have risen 2%. Same-store sales is a retail industry metric that measures stores that have been open a year or more.

Considering the level of insecurity about the economy, the willingness of Americans to spend even moderately more than a year ago is a step in the right direction.

Clothing retailers have spiked 17% year-to-date, led by Ross Stores (ROST, Fortune 500) (up 25.4%) and Abercrombie & Fitch (ANF) (up 24.6%). General merchandisers are up 12%, including Family Dollar Stores (FDO, Fortune 500) (up 27.3%) and Big Lots (BIG, Fortune 500) (up 24.2%). Big department chains are up 11%, including Macy’s (M, Fortune 500) (up 28.6%) and Sears Holdings (SHLD, Fortune 500) (up 24.7%).

Discounters have been outperforming their luxury brethren, unsurprising in a post-recession economy. But the sector as a whole has also been holding up well, despite middling consumer sentiment and an unemployment rate that stood at 9.7% last month.

Aside from traditional retail, consumer discretionary, the category that also includes restaurants, hotels and casinos, is up 8% from the start of the year. That makes it the second-best performing sector this year, narrowly trailing industrials, which include Dow stocks Boeing (BA, Fortune 500) (+29%) and General Electric (GE, Fortune 500) (up 15%). 

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Former U.S. Interior Secretary Stewart Udall died Saturday. He was 90.

Udall served under Presidents John F. Kennedy and Lyndon B. Johnson during the 1960s. He previously served as a congressman from Arizona.

Stewart Udall was the brother of the late Morris Udall and the father of U.S. Sen. Tom Udall, D-N.M. He is viewed as one of the early leaders in the modern U no teletrack payday loan.S. environmental and conservation movements.

He died of natural causes in New Mexico, according to statements by his family.

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Sales of Apple Inc.'s iPad tablet computers are reportedly on a pace that could beat the debut sales of the iPhone.

The Wall Street Journal cited estimates from unnamed sources on Thursday who said Apple has sold hundreds of thousands of iPads since orders began on Friday.

It quoted one person it said is "familiar with the matter" that Apple could sell more iPads in its first three months than it sold iPhones in its first three months personal loans for people with bad credit.

The Journal reported that as the April 3 delivery of the first iPads approaches, Apple (NASDAQ:AAPL) is still working to secure content for the devices.

Among the features it said it still being negotiated with media companies is a price cut on TV shows that people can be downloaded onto the device.

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Comparison shopping site Become.com on Monday named Charu Rudrakshi chief technical officer.

Rudrakshi will oversee the direction and management of Sunnyvale-based Become Inc.’s global technical operations.

The company said he has more than 20 years of experience in building diverse products, from backend servers to Web applications. He was vice president of engineering at Sunnyvale-based Yahoo Inc., and also worked at eBoodle.com, Verity, Yodlee and Clearwell Systems.

Become.com was founded in 2004 by Michael Yang, who was also a founder of comparison shopping engine MySimon in 1998.

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Cisco unveiled a new Internet technology Tuesday that it says will provide the ultra-fast data speeds necessary to stay ahead of users’ rapidly growing online video demands.

The new technology, known as "CRS-3," is a network routing system that will be able to offer downloads of up to 322 Terabits per second, according to the company.

Translation: Well in Cisco terms, the router will be able to provide download speeds of 1 Gigabit per second for everyone in San Francisco, download the entire printed collection of the Library of Congress in 1 second and stream every movie ever created in less than 4 minutes.

Cisco Chief Executive John Chambers acknowledged that many skeptics will say that those speeds and network capacity are not necessary, but he argued that the fast-growing media usage on mobile phones will ultimately demand it.

"I know this is not that exciting to the average consumer right now, but it is the foundation for future speeds," Chambers said in a Web cast Tuesday. "When it comes to mobile devices, I want to get any video, anytime and be able to share that on any device in your living room. The foundation of that is the CRS-3."

Wireless providers have reported a sharp increase in data downloads as more consumers buy smartphones, and they are quickly scrambling to update their networks to increase capacity for growing data traffic. AT&T (T, Fortune 500), which saw its network traffic grow 40% in 2009, said Tuesday that it has run a successful test of the CRS-3 under a partnership deal with Cisco free online credit report.

It’s not just mobile that’s growing. Streaming video services like YouTube are now offering high-definition video, and broadcast networks and cable companies continue to put more of their content on the Internet.

"Cisco has set a new bar for network performance," said Zeus Kerravala, research fellow at Yankee Group. "Many may think we’ll never need that much bandwidth, but the enterprise future of mobile TV, streaming media, YouTube, telepresence and 3-D HD TV surely demands it."

Cisco said the CRS-3 will triple the speed of its predecessor, the CRS-1, and it will offer speeds of up to 12-times faster than the next fastest product on the market. The company invested $1.6 billion in the technology and will begin selling the routers at $90,000. The networking company said it expects the CRS-3 will be available in the fall.

The announcement comes a week after Google (GOOG, Fortune 500) announced it would test a super-fast broadband network in a U.S. city, and it is a week before the FCC will reveal its plan to increase broadband speeds and access for Americans.

Shares of Cisco (CSCO, Fortune 500), which were up 4% on Monday ahead of Tuesday’s announcement, fell about 1% in midday trading. Shares fell sharply immediately following the announcement in a "sell on the news" move, but managed to recover some lost ground. 

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Buffalo Mayor Byron Brown has filled one of the several key vacancies in his administration - without leaving City Hall.

Brown tapped Brendan Mehaffy as the executive director of the Buffalo Office of Strategic Planning, one of the city's primary economic development agencies.

Mehaffy is an attorney in Buffalo's law department. With his appointment, effective March 29, he will be paid $82,257 annually.

Mehaffy replaces the embattled Brian Reilly, who resigned late last year. The department had been run on an interim basis by Drew Eszak, a respected planner.

Brown said he hopes Mehaffy's appointment will bring some stability to a Buffalo office that has been something of a revolving door. Last year, Brown recruited Buffalo native Michael Kimelberg to head the department, but Kimelberg - in a surprise move -decided to remain in Seattle.

Mehaffy's appointment comes just weeks after Brown pledged to update Buffalo's antiquated zoning codes and to merge the Buffalo Urban Renewal Agency and Buffalo Economic Renaissance Corp. into a single, one-stop entity.

"This is an exciting time in our city's history with a variety of development projects changing the city's landscape," Mehaffy said.

Mehaffy holds a bachelor's degree in economics from SUNY Binghamton, a master's degree in urban regional planning from the London School of Economics and is a graduate of the University at Buffalo's School of Law.

"His knowledge of land use planning and project development was honed through both his academic and professional experiences," Brown said. "Brendan has been the city's point person on several high profile projects, including negotiations with the county to return the operation and maintenance of city parks back to Buffalo."

The Buffalo Niagara Partnership, who helped Brown with his search, recommended Mehaffy.

Brown still has to fill other high level administrative vacancies including police and fire chief.

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ST. LOUIS — Anheuser-Busch unveiled a shake-up in its marketing department Tuesday that divides responsibility for beer brands along consumer-segment lines and places greater importance on developing new products and reaching multi-cultural consumers.

But the brewer was close to mum on any layoffs that might result from the shake-up. A-B marketing Vice President Keith Levy said, "There were some, but we’re not getting into numbers."

The only specific departure mentioned, via an e-mail sent to A-B workers, was Marlene Coulis. She is an 18-year A-B veteran who holds the title vice president of consumer strategy, insights and innovation. She will stay through month’s end, A-B said. The brewer gave no reason for Coulis’ departure. She could not be reached for comment.

The marketing changes were anticipated since A-B announced last month that it planned sweeping changes to both its sales and marketing. Company President Dave Peacock said the changes were aimed at making A-B "optimally organized and as efficient as possible."

The changes were developed after months of work under the code name "Kashi" — as in the cereal with the slogan "Go Lean." Sources said about 450 jobs would be cut as part of the initiative free credit report online.

A-B’s sales force learned its fate two weeks ago, with a series of promotions and, according to sources, 90 layoffs, including four vice presidents.

In the marketing department, A-B said three top-line executives were promoted to new roles: Linda Tucker to vice president of insights, Julia Mize to vice president of marketing solutions and Juan Torres to senior director of value brands.

All are A-B veterans.

Several others are staying in their current roles. But across the board, there is more emphasis on reporting directly to Levy, including Pat McGauley, vice president of innovations, and Eduardo Pereda, senior director of multicultural marketing.

Such changes represent the company’s priority on brand development and multicultural segments, Levy told the Post-Dispatch on Tuesday.

The brewer also realigned the way it handles marketing to fit consumer segments — premium light (Bud Light, Michelob Ultra and Select 55), imports and crafts (higher-end consumers), value brands (important brews, but with less marketing support) and Budweiser.

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Despite signs that the real estate market might be lurching forward, prices are expected to fall further this year and next.

The average home price in the United States will fall by about 6% by September 2011, according to a joint report between Fiserv and Moody’s Economy.com. And that’s after plunging more than 27% in the past three years.

Most of the projected home price decline will occur during the usually slow summer months of 2010. After that, prices should begin to stabilize, according to Fiserv, and stay almost flat through fall of 2011.

The main reason for continued decline, according to Mark Zandi, economist and co-founder of Economy.com, is foreclosures — the same thing that’s plagued markets for the past three years.

"Foreclosure sales will pick up this spring as mortgage servicers figure out who can qualify for a modification and who can’t," said Zandi.

He figures there are at least 4.5 million mortgage loans either in foreclosure or clearly headed in that direction. When that additional inventory hits the market, it will provide numerous choices for buyers and encourage sellers to drop their listing prices.

The end of two federal programs, which have been propping up markets, will also tamp down prices.

The Federal Reserve has been purchasing mortgage-backed securities since early 2009, scooping up as much as $1.25 trillion worth. That has dampened rate increases by providing a ready market for the securities. But the Fed’s program lapses on March 31, when it cedes the playing field to private investors, who will almost surely demand higher rates.

Any resulting rise in rates will cause some buyers to withdraw from the market and others to look for lower priced homes guaranteed online payday loans. Either way, demand for homes drops and so do prices.

A month after the Fed bows out of the mortgage-buying market, the homebuyer tax credit will start to expire. To qualify for the $8,000 credit, homebuyers must sign a contract before April 30 and close by June 30. When the first date passes, many buyers are expected to vacate the market, weakening the demand for homes.

In a broader sense, home prices are ultimately decided by employment. "If [the job market] improvement is stronger than expected, prices will get better. If it’s weaker than expected, prices will be worse," Zandi said.

Worst of the worst

The worst performing market will be Miami, Fla. Moody’s projects prices there to drop a heart-stopping 29.2% by Sept. 30. That follows a 47.7% decline the metro area recorded in the past three years. Grand total: 64% drop.

Other disastrous performances will be turned in by the Hanford, Calif., metro area, where prices are projected to plummet 27.2% through Sept. 30, 2010 following their 36.9% drop for the previous 36 months. Ft. Lauderdale and West Palm will also register steep drops.

There’s some good price news coming out of California’s Central Valley for a change; prices will begin to emerge from their free fall toward the end of this year.

In Merced, for example, which crashed and burned by 71.8% in the past three years (through last September), they’ll only fall only another 6.2% in the next six months before bouncing back with a rise of 10.1% by Sept. 30, 2011. 

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