Menu Close
Posted in Contributors- Economic and Financial, Housing, Other Guys, Taken Down

US data: manufacturing activity remains weak; improvements seen in consumer confidence and resi construction- Sober Look

This is a syndicated repost courtesy of Sober Look. To view original, click here. Reposted with permission.

The Manufacturing ISM number did not surprise to the downside as Goldman’s GSAI was indicating (see discussion). The divergence between GSAI and the ISM has in fact widened, as the corporate sector exhibits a great deal of pessimism. Nevertheless US manufacturing continues to struggle. The longer trend for ISM seems to be trending lower.

Source: Econoday

The Markit Manufacturing PMI paints a similar picture – though both indices beat consensus. Manufacturing is not contracting (the way it has in Europe or even China) but there doesn’t seem to be much growth either.

Source: Markit

There are however two key developments in the US economy that are fairly positive:

1. Consumer confidence is improving. Clearly it is not at the 2006-2007 period levels, but any improvement is good news at this stage.

Conference Board: – Says Lynn Franco, Director of Economic Indicators at The Conference Board: “The Consumer Confidence Index increased again in October and is now at its highest level this year. Consumers were considerably more positive in their assessment of current conditions, with improvements in the job market as the major driver. Consumers were modestly more upbeat about their financial situation and the short-term economic outlook, and appear to be in better spirits approaching the holiday season.”

Source: Econoday

2. Housing/construction shows gradual improvements as well. If anything it is nice to see construction spending in the positive territory again.

Econoday: – While manufacturing remains sluggish, construction made a comeback. Construction spending rebounded 0.6 percent in September, following a decline of 0.1 percent the prior month (originally down 0.6 percent). Market expectations were for a 0.6 percent gain.

The boost in September was led by a 2.8 percent increase in private residential outlays after a 1.2 percent fall the month before. For the current month, private nonresidential spending slipped 0.1 percent while public outlays decreased 0.8 percent.

On a year-ago basis, overall construction was up 7.8 percent in September, compared to 7.6 percent the month before. The construction sector continues to improve but largely in housing.

Wall Street Examiner Disclosure: Lee Adler, The Wall Street Examiner reposts third party content with the permission of the publisher. The opinions expressed in these reposts are not those of the Wall Street Examiner or Lee Adler, unless authored by me, under my byline. I curate posts here on the basis of whether they represent an interesting and logical point of view, that may or may not agree with my own views. Some of the content includes the original publisher's promotional messages. No endorsement of such content is either expressed or implied by posting the content. All items published here are matters of information and opinion, and are neither intended as, nor should you construe it as, individual investment advice. Do your own due diligence when considering the offerings of information providers, or considering any investment.

Related Posts

Leave a Comment

This site uses Akismet to reduce spam. Learn how your comment data is processed.