By Martinne Geller and Brad Dorfman

"The modest pickup in total consumer spending almost all U.S. businesses saw earlier in the year has reversed in the past several months," Indra Nooyi, chief executive of PepsiCo Inc <PEP.N>, said during a conference call on Thursday after the soft-drink and snack company tempered its full-year earnings target.

Her comment echoed those of other consumer products executives, as lingering high unemployment, a stubborn housing market and $4-a-gallon gasoline pressure sales for companies that are also grappling with their own soaring costs for ingredients and raw materials. In the latest data, weekly U.S. jobless claims rose more than expected.

"There's no question that the U.S. consumer is still mixed, confused and somewhat apprehensive," Coca-Cola Co <KO.N> Chief Executive Muhtar Kent told Reuters on Tuesday.

Consumer spending accounts for about 70 percent of the U.S. economy. While higher-income consumers have been more comfortable spending due to gains in their stock portfolios, middle- and lower-income shoppers are still cautious.

"We get fooled because the stock market has been going up ... and that has created a wealth effect for those people who are in the market," said Edward Jones analyst Jack Russo. "But there are so many people who aren't."

Russo said spending could come under further pressure as the year progresses, as prices on so many consumer goods go up without any corresponding increase in incomes.

The Dow Jones U.S. Consumer Goods index <.DJUSNC> was up 0.9 percent on Thursday, underperforming the wider Standard & Poor's 500 index <.SPX>, which was up 1.4 percent in afternoon trading.

Despite the U.S. stock market's broad rise on Thursday, shares of many consumer products companies were lower. Whirlpool was down 4.2 percent at $72.48, PepsiCo was down 4.5 percent at $65.44 and Safeway was down 8.7 percent at $21.58 in afternoon trading.

ONE STEP FORWARD, TWO STEPS BACK

The weak recovery is taking its toll on sales of everything from soda to washing machines and other big-ticket items. It even raised the specter of the recent recession.

"Second-quarter industry demand levels were back (at) the same levels we saw at our 2009 recession lows," Whirlpool <WHR.N> CEO Jeff Fettig told analysts on Thursday

The world's largest home-appliance maker now expects industry-wide shipments to decline by 1 to 2 percent in the United States this year, down from its prior forecast for a rise of 2 to 3 percent.

Whirlpool is one of many companies being squeezed between higher costs -- in this case for steel, copper and oil -- and a consumer not able or willing to shell out more to cover those costs.

"Whirlpool is bringing out great products, but I think they might be pricing themselves out of the market ... in this type of market where everything is very volatile," Wall Street Strategies analyst Brian Sozzi said.

Ingersoll Rand Plc <IR.N> also reported a lower-than-expected profit on Thursday as demand for home air conditioners remained slack, and U.S. grocery store operator Safeway Inc <SWY.N> reported weaker-than-expected sales, sending shares down 9 percent.

And consumers still need to get past some new shocks, in the form of additional price increases that have taken their time to move through complex supply chains.

"We're waiting to see how the second half unfolds as consumers come face-to-face with even higher prices in apparel and footwear," said VF Corp <VFC.N> CEO Eric Wiseman on a conference call with analysts.

Still, some investors are betting that conditions will improve later this year, as year-over-year commodity inflation eases and Japan recovers from the devastating earthquake and tsunami, which could generate manufacturing jobs in the United States and improve consumer confidence.

"In an aggregate sense, third-quarter economic news ought to be better than second-quarter economic news," said Phil Orlando, chief equity market strategist at Federated Investors.

But that may not move the needle by much, so some companies are planning for the pain to continue.

"At current GDP growth rates, they're not likely to move unemployment by much over the course of the next year or so, so we are expecting things to continue to be challenging," said PepsiCo Chief Financial Officer Hugh Johnston.

(Writing by Brad Dorfman. Additional reporting by Phil Wahba, Nick Zieminski and Dhanya Skariachan in New York, editing by Matthew Lewis)