The index of U.S. leading indicators probably climbed in September for the third straight month, signaling the recovery will extend into 2011, economists said before reports today. The Conference Board’s gauge of the outlook for the next three to six months rose 0.3 percent, according to the median estimate of 57 economists surveyed by Bloomberg News. Another report may show the number of Americans filing applications for jobless benefits dropped last week. Gains in consumer spending, business investment and exports may keep the world’s largest economy afloat even as housing remains depressed. At the same time, growth will probably not be strong enough to reduce unemployment, underscoring why Federal Reserve policy makers have said additional stimulus may be needed. “The soft patch in the economy is starting to lift, and prospects for improved, more sustainable growth are rising,” said John Herrmann, senior fixed-income strategist at State Street Global Markets LLC in Boston. “But we still need stimulus. The underlying recovery is still too fragile.” The New York-based Conference Board, a private research group, will release its report at 10 a.m. Bloomberg survey estimates ranged from gains of 0.1 percent to 0.6 percent. The Labor Department’s report on jobless claims is due at 8:30 a.m. The median forecast of economists surveyed calls for a declined to 455,000 from 462,000 the prior week. Estimates ranged from 430,000 to 465,000. Rising Shares The Standard & Poor’s 500 index has climbed 3.2 percent this month as some Fed officials said they were prepared to pump more cash into the economy to spur the recovery, a tactic known as quantitative easing. The gauge jumped 8.8 percent in September. “There would appear -- all else being equal -- to be a case for further action,” Fed Chairman Ben S. Bernanke said in an Oct. 15 speech. The recovery is likely to be “fairly modest in the near term,” and “the preconditions for a pickup in growth next year remain in place,” he said. Seven of the 10 indicators that make up the leading index are known ahead of time: stock prices, jobless claims, building permits, consumer expectations, the yield curve, factory hours and supplier delivery times. The Conference Board estimates new orders for consumer goods, bookings for capital goods and the money supply adjusted for inflation. ‘Gradual Recovery’ CSX Corp., the second-largest publicly traded U.S. railroad, last week said third-quarter profit increased 43 percent, topping analysts’ estimates, as rising automotive shipments boosted rail volumes. Except for housing, “we’re seeing things continue their gradual recovery,” Chief Executive Officer Michael Ward said in an interview on Oct. 13. The economy isn’t creating enough jobs to cut unemployment, which is hovering near 10 percent. President Barack Obama and the Democrats are confronted with voter anger over the state of the economy less than two weeks before the congressional election. An Oct. 7-10 Bloomberg National Poll shows almost two-thirds of voters believe the country is on the wrong track and unemployment is the top concern for about half the electorate.

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