A strange reaction today to an "ok" U.S. ISM Mfg report. While the weakest reading of the year, it is still expansionary and close to what analysts expected. And the figures still seem out of line with the regional surveys we are seeing.
New orders were at the worst levels in over a year and "bad," but is bad good for speculators? I am not even sure what I am supposed to be rooting for at this point - sort of like mid 2009... good news or bad news (more easy money?). Based on the "lies" from Bernanke, [Bernanke Lied to Us] I don't think it matters one iota what the economic news is going to be like in the next 5 weeks - QE2 is coming based on the Fed language. Ben has his Iraq war in his sights... he will find any convenient reason to avenge his father! But the market seems to believe if we get 2-3 good economic reports it might not happen.
Again U.S. manufacturing is 13% of the economy and 9% of the work force. The obsession with it by the market is misplaced... this is not China. We are a service economy and the service ISM is far more important in the real world of Americans. That indicator has been far weaker throughout this 'recovery', and should have far more sway to market participants, but speculators apparently still are living in U.S.A. 1976 based on how they react to the manufacturing reports.
- Manufacturing expanded in September at the slowest pace in 10 months. The Institute for Supply Management’s factory index dropped to 54.4 from 56.3 in August. Readings greater than 50 signal growth and economists forecast a decline to 54.5, according to the median estimate in a Bloomberg News survey.
- Measures of orders and production fell to the lowest level since June 2009.
- The ISM’s U.S. new orders measure declined to 51.1 from 53.1
- The employment gauge fell to 56.5 in September, the lowest in six months, from 60.4, and the index of export orders dropped to 54.5, the lowest this year.
- The measure of orders waiting to be filled fell to 46.5 from 51.5 and the index of prices paid jumped to 70.5 from 61.5.
- China’s manufacturing expanded in September at the fastest pace in four months, a separate report showed today. The purchasing managers’ index rose to 53.8 from an August reading of 51.7, China’s logistics federation and statistics bureau said in an e-mail.
Growth in European manufacturing slowed. A gauge of manufacturing in the 16-nation euro region declined to 53.7 in September from 55.1.