Economists may see a recovery underway, but in a nation heavily dependent on consumer spending, the economic rebound won t feel convincing until people start shopping again.

The Reuters/University of Michigan Consumer Sentiment Index for february slipped slightly, to 73.6 from 74.4 in January. On Thursday, weekly jobless claims jumped by 22,000, more than economists had expected, rattling the stock market. Earlier this week, the Conference Board reported its Consumer Confidence Index had dropped to 46.0 from 55.9 in January, with consumers assessment of current conditions at its lowest point in 27 years.

Based on those numbers, you wouldn t expect to see the American consumer returning to the mall. And the latest data available from the Commerce Department show personal consumption expenditures rising just 0.1% in December, when adjusted for price changes. Purchases of services and durable goods edged up, but purchases of nondurable goods fell 0.8%. After years of spending more than we earned, Americans achieved a 4.8% personal savings rate in December.

So we re not exactly on a shopping spree. But earnings reports from several major retailers this week did show signs of real improvement, and analysts say the sector has at least come through the worst of the downturn. It s not some signs [of improvement] somewhere, it s a real turn, says Lizabeth Dunn, an analyst at Thomas Weisel Partners. I don t put much weight in the consumer confidence numbers what you really have to look at is the sales trends, which are clearly much, much better across the board, Dunn says.

Here are four signs of life that appeared in major retailers quarterly results this week:

Same-Store Sales Trends

Comparable same-store sales, a crucial measure of retail success, are either declining more slowly or turning upward for many retailers. Lowe s reported a 1.6% year-over-year decline in fourth-quarter same-store sales compared to a 6.7% decline for the full fiscal year, that s a step in the right direction. Macy s same-store sales for the fourth quarter were down just 0.8%, compared to a 5.3% decline for the full year. Gap (GPS) saw 2% same store sales growth in the fourth quarter, led by 7% growth for the Old Navy division, with Gap division same-store sales slipping 1%. Nordstrom s same-store sales grew an impressive 6.9% for the quarter.

Retailers are muddling along the bottom with a slant upward, says David Strasser, an analyst at Janney Montgomery Scott. Things are definitely heading in the right direction, the question is the sustainability of that direction, Strasser says. Executives at companies like Lowe s, Home Depot, and Target are starting to sound more optimistic, and Lowe s is actually hiring to prepare for expected sales growth, he says. Home Depot also announced it was raising its dividend by 5%, its first increase since 2006.

Increasing Margins

Analysts say that shoppers are likely to continue to be price-sensitive for some time yet, but retailers race to the bottom on pricing may be slowing. Target reported that its overall gross margin rate rose 1.8 percentage points in the fourth quarter despite faster sales growth in lower-margin categories, in part because clearance sales declined by 20%. Towards the other end of the retail spectrum, Nordstrom s also reported that gross profit increased in the fourth quarter as markdowns were reduced. Gap reported operating margin rose for the quarter, to the highest it s been in a decade. It s encouraging that not only are sales rising, but companies aren t just giving it away, Dunn says.

Many retailers have focused during this downturn on controlling inventory, cutting costs, and improving the efficiency of their operations, says Brian Sozzi, an analyst at Wall Street Strategies. Companies that, like Home Depot, Target, or Gap, have really made distribution or sourcing more efficient will be best positioned to benefit from rising sales trends, Sozzi says.

Shoppers Spending More

Both Home Depot and Lowe s reported some signs of improvement in terms of how much shoppers were willing to spend. Home Depot saw a slower decline in the average amount spent by each shopper, and Lowe s reported improvement in bigger-ticket sales. For the home-improvement chains, this trend could reflect pent-up demand for more expensive items, as homeowners have been putting off replacing aging appliances, Strasser says. Target also saw the number of units bought per transaction increase by 0.9% for the quarter.

The Upper End Picks Up

Nordstrom s strong sales trends demonstrate that the upper-end consumer is heading back to stores, Dunn says. The upper-middle-class consumer is in a little bit better position than consumers that shop at more moderate price points, she says. The high end typically comes back first following a downturn, Strasser says.

It s no surprise that people who have money will spend it, but is the bargain-hunting consumer ready to trade back up? Wal-Mart saw same-store sales fall 2% in its most recent quarter, while Target s same-store sales rose 0.6% in the fourth quarter. That contrast might suggest that the consumer s going to a discretionary-oriented retailer a bit more, Sozzi says. For now, retailers are still fairly cautious about their projections for 2010, but shoppers are spending a bit more freely than consumer sentiment surveys might suggest.