NEW YORK — After a tough two-year stretch of business, the worst mightbe over — as beauty vendors in the prestige and mass markets are betting on a continued yet modest turnaround in the first half of 2004.

After dealing with SARS, the U.S./Iraq conflict and rough weather in the first half of 2003, vendors said in July that they were beginning to see a glimmer of hope for the second half of this year — which has been borne out over the past several months by many of the major players. Even the year’s most challenging category — fragrance — seems, in many vendors’ eyes, to be stabilizing its downslide.

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