This is the daily notebook of Mike Santoli, CNBC’s senior markets commentator, with ideas about trends, stocks and market statistics. A breakfast of benign economic and earnings data, plus easily digestible Fedspeak, feeds a relief rally in stocks, with “better than feared” inputs easing worry slightly on recession, earnings pain and the Federal Reserve’s aggressiveness. The market has shown itself unwilling to buckle toward the June lows, even if it remains mired at the bottom end of the 2022 range. In nine of the past 11 trading days, the S & P 500 has finished well higher than its morning low, a function of low equity exposures (and low expectations) among professional investors, and some relief coming from the bond and commodity markets. Still carving out a sideways range, plausibly settling into some kind of bottoming setup, but it’s hard to have a lot of conviction on this prospect. Hurdling 4,000 in a broad burst of buying energy remains a next step for bulls to earn back some benefit of the doubt. A healthy beat on nominal retail sales, better Empire State Manufacturing (with cooler inflation indicators) and a modest beat on University of Michigan’s consumer sentiment report and its inflation-expectations component helped put the bid in the market. Also had commentary from more bank CEOs that consumer/corporate activity and credit indicators are “fine for now” even as they might worsen a bit. St. Louis Fed President Jim Bullard and Atlanta Fed president Raphael Bostic hinted of a 0.75 percentage point rate hike the week after next without pushing for a full percentage point, though there is still some play in this outlook. The outsize focus on UMich inflation expectations — a not-very-reliable survey of a couple hundred people — might seem a reach for traders, but Fed Chair Jerome Powell himself brought this on by citing last month’s early read from this survey as a cover story for the 0.75 percentage point hike in June. The survey seems mostly to track gasoline prices and the political mood, but it’s become at least a MacGuffin propelling the Fed plot. The bulls’ hope remains that earnings and guidance come in “better than feared,” that valuations have somewhat adjusted for softer outlooks and that the recession talk is mostly about investors over-anticipating a downturn based on market signals and Fed body language rather than clear leading indicators. It’s worth recalling that there was a pretty entrenched recession camp both in 2011 and early 2016, proving false alarms. Yes, this is quite different in the particulars now: The market is trying to look ahead to the inflection point in the cycle and a dovish shift by the central bank, and the Fed is demanding (for now) months of real data proving inflation has been truly felled. But the inflation path and Fed guidance can change quickly, as the past eight months have shown, so the market will keep trying to play a possible turn. CEOs and economists talking about consumers being in decent shape and with good balance sheet support are not sugar-coating things. The household financial obligations ratio — debt service plus rent/mortgage payments — relative to disposable income is quite low, in stark contrast to periods preceding past recessions. The S & P 500 is spending a good deal of time near the 3,850 level, as it did earlier in the week. This is another options expiration day, when sometimes round numbers exert gravity. It’s also the threshold representing 20% below the record highs. Credit is firming today on the better economic cues and the 2-year Treasury yield at 3.1% is nicely off Thursday’s early high near 3.25%, macro stress easing slightly along both fronts. Good market breadth: 85% up volume on NYSE. VIX down 2 and slipping under 25 ahead of a summer weekend. Low end of the three-month range. Not low enough to speak of expected stability, but it also proves all those folks insisting VIX “should be higher” back near the market lows didn’t quite have it right.