Evidences on the U.S. economic recovery have been far from comforting. Although we have been seeing some upturn in the housing market and consumer spending, the improvement is only modest. Meanwhile, manufacturing and business spending, which were earlier spearheading the economy recovery, are losing steam. The uneven and volatile nature of the recovery is definitely a cause of concern. BMO Capital Markets sees two scenarios that could emerge. If the consumers and homebuyers supported by improved finances and low borrowing costs spend more, then the stronger income growth will reinforce demand and lift the economy onto a higher trajectory. However, if businesses continue to pullback due to the looming fiscal cliff and delayed reforms to taxes and regulatory policies, the growth will remain subpar and the unemployment rate will hardly budge. Last week, the Commerce Department reported that new home sales fell 0.3 percent month-over-month to a seasonally adjusted annual rate of 373,000 in August. Meanwhile, July sales were upwardly revised to 374,000 from the 372,000 estimated initially. Inventories remained unchanged at 141,000, while inventories measured in terms of months of supply held steady at 4.5 months. The median price of an existing home was up 17 percent year-over-year in August. Meanwhile, a report released by the National Association of Realtors showed that pending home sales fell 2.6 percent month-over-month in August following a 2.6 percent increase in July. Pending home sales fell in all the regions except the Northeast. The results of the S&P/Case-Shiller house price survey showed that house prices rose 1.2 percent year-over-year in July, the biggest annual advance since August 2010. Only 4 out of the 20 cities saw declines in house prices. On a seasonally adjusted basis, house prices were up 0.44 percent compared to the previous month. The Commerce Department downwardly revised its GDP growth estimate to 1.3 percent from 1.7 percent. At the same time, the Conference Board's consumer confidence index rose to 70.3 in September from 61.3 in August, with the improvement primarily stemming from an optimistic outlook for the job market. Consumers expecting more jobs in the months ahead rose to 18.5 percent from 15.8 percent, while those anticipating fewer jobs fell to 18.5 percent from 23.7 percent. Job market indicators are likely to be in the spotlight in the unfolding week, with the Labor Department's non-farm payrolls report for September, ADP's private sector employment report and the weekly jobless claims report among the closely watched reports. Traders may also focus on the results of the Institute for Supply Management's manufacturing and non-manufacturing surveys for September and a speech by Federal Reserve Chairman Ben Bernanke.