Factory orders in July were up 2.4% compared to June, which was down .4%. The consensus was 1.5%. So the actual numbers beat the estimates quite nicely. The market has now touched positive territory for the year. It has been tough to give any concrete guidance on where our economy is heading. Reports have been mixed.
August PMI numbers came in at 56.5. This is less than July. However, it is important to note that August tends to be a slower month as that is considered the peak of vacation season.
If we look at the overall picture, the PMI numbers have still been stagnant. We are slightly higher than when we were in August of last year. The numbers beat across the board and basically any number over 50% indicates growth in the region. So the Chicago region is seeing growth, but not as quickly as many would like. The real issue is that the Chicago region is seeing slowing growth in orders. I like the fact that the region is showing improvement, but the rate of growth is fairly slow. The market is up nicely on the report, which is good. One last thing to note is that another reason Chicago PMI numbers in August were lower than July could have been because of the anticipation of Hurricane Irene. East Coast companies could have cut back for several reasons, whether it be power outages or having to abandon factories temporarily. It is still tough to come to a conclusion as this number is specific to a region, but regardless it still beat expectations.
Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.