NEW YORK — Financial markets are puzzled about whether the housing sector has bottomed out or not. Executives leading the nation's home builders certainly aren't making that assessment any easier.

Those CEOs are publicly saying more doom-and-gloom is on the way. But they are providing a more upbeat outlook behind closed doors, judging by their responses in a closely watched survey tracking their sentiment.

The tricky part is knowing what to believe. Investors seem to be latching on to the positive, pushing shares of home builders higher in recent months. Many on Wall Street worry that they could be getting ahead of themselves.

A five-year surge in home prices came undone over the past year amid fears that higher mortgage rates would cool buyer demand. While rates haven't jumped much, sentiment in the housing market changed dramatically, resulting in a steep decline in new home construction, sales and building permits.

As the housing market contracted, home-building stocks plunged. But they began moving higher over the summer. The Standard & Poor's 500 Home-building index is up 13 percent since late July, compared with the 33 percent decline during the first seven months of the year.

Those who have been talking up the home-building sector include some big institutions, including Neuberger Berman and Legg Mason. The thinking goes: As the housing market's retreat begins to slow, earnings will rebound and potentially will take stocks along with them.

Investors seem to be hanging their hopes on data like the report coming from the National Association of Home Builders last week, which showed that builder sentiment was up for the second straight month in November. The biggest gain was seen in the builders' expectations for the next six months.

"Looking ahead, builder outlook is perking up," NAHB President David Pressly, a home builder from Statesville, N.C., said in a statement. "Our members are telling us that the market is steadying after a significant downward correction. On the demand side, we look for sales to stabilize and gradually move up in the coming months."

But that contradicts what many home builders have been saying lately to their shareholders and stock analysts. Just about every CEO running a public company in that sector has been pessimistic recently in their outlook for the housing market.

Among some of the negative comments: