WASHINGTON --- Brighter news on manufacturing is offering more hope that the longest recession since World War II is near an end. But with construction and many other segments of the economy still weak and unemployment rising, any rebound likely will be slow.

A key gauge of manufacturing showed Wednesday that industry activity declined less than expected in June. The Institute of Supply Management's manufacturing index posted a 44.8 -- the best showing since last August, a month before the financial crisis erupted with force.

Manufacturing sectors overseas also signaled a bit of a rebound, though other U.S. economic news was more mixed.

Construction spending fell in May for the seventh time in the past eight months. Spending dropped more than expected as strength in nonresidential building was eclipsed by a decline in housing construction and weakness in government projects.

But in a hint of better days to come, the National Association of Realtors said an index of pending home sales edged up 0.1 percent in May. It was the fourth straight advance for the index, which tracks contracts to buy previously owned homes.

"I think the great recession is winding down," said Mark Zandi, chief economist at Moody's Economy.com. "Retailing should firm a bit in the next few months, helped by the stimulus package, and I think lean inventories will trigger production increases."

Many analysts said the mixed nature of the new reports show an economy starting to turn the corner. But they remain cautious.

"This downturn was too big and too global an event to hope that the bottoming process will be quick," said Cliff Waldman, an economist with the Manufacturers Alliances/MAPI, an industry trade group. "I think the economy is going to take two steps forward and one step back."

Many economists say they think the drop in GDP slowed to about 2 percent in the April-June quarter. More optimistic analysts believe the economy will start growing again in the current July-September period.

Mr. Zandi said the $787 billion stimulus package of increased government spending and tax cuts should translate into a sizable boost to the economy in this quarter, turning what would have been another GDP decline into a small increase of around 1 percent.

But the rebound in GDP won't halt a continued rise in unemployment. Economists predict the unemployment rate climbed to 9.6 percent last month. The June report will be released today.