Some Wall Street analysts reportedly think the worst is over for industrial stocks and have upgraded their extimates for Rust Belt stocks after a stretch of weak demand.

“With [third quarter] earnings season done...we’re staying long machinery [and] industrials,” wrote ISI Evercore analyst David Rasso in a Friday research report, Barrons’ reported.

“From a top-down perspective, Rasso says, machinery stocks do well when interest rates fall and the so-called yield curve steepens, meaning the gap between short-term and long-term rates is getting bigger. The differential is increasing right now, and of course, the Federal Reserve just cut interest rates,” Barron’s said.

“And from a bottom-up perspective, Rasso says, year-over-year declines in orders, sales and earnings reported by machinery and other industrial companies will become year-over-year growth by the second half of 2020. Don’t forget that the market is forward looking, pricing in tomorrow’s growth environment today,” the financial newspaper reported.

Rasso upgraded shares of heavy-duty engine-maker Cummins (CMI) from the equivalent of Hold to Buy and increased his price target for the stock from $148 to $207, 11% above recent levels. Rasso also wrote that Caterpillar (CAT), CNH Industrial (CNHI), and United Rentals (URI) are his three favorite industrial stocks.

Other economic indicators are also turning more positive.

DoubleLine Capital, the investment manager headed by Jeffrey Gundlach, recently lowered its view on the chances of a U.S. recession in the next year to 40% from 75% a few months ago, said Andrew Hsu, co-portfolio manager of the DoubleLine Total Return Bond Fund (DBLTX).

“It has changed in the past several months,” Hsu said at the Reuters Global Investment Outlook 2020 Summit in New York. “The base case right now is that we estimate over the next 12 months a 40% chance of recession, and that’s down from 75% that we stated several months ago,” he said, according to Reuters.

Hsu cited “some improvement in economic fundamentals” and the potential resolution of the U.S.-China trade dispute.

“Although I don’t think the trade dispute will be resolved anytime soon, there have been some positive steps in the process,” he said.

U.S. economic growth slowed to 1.9% in the third quarter as business investment fell on trade war concerns. Nevertheless, weaker growth and a slowdown in the manufacturing sector has not yet spilled over in consumer spending or employment.

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