Post by unlawflcombatnt on Jan 2, 2008 16:18:22 GMT -6
from Bloomberg:
U.S. Manufacturing Contracted in December
By Courtney Schlisserman
Jan. 2, 2008
"Manufacturing in the U.S. unexpectedly shrank the most in almost 5 years....
The Institute for Supply Management's manufacturing index dropped to 47.7, the lowest reading since April 2003, from 50.8 the prior month....50 is the dividing line between contraction and expansion.
Manufacturing is near stalling as the housing recession extends beyond building-related industries to affect credit standards and consumer and business spending plans. Slower factory production and company spending will weigh on economic growth.
``We're getting down to that area where manufacturing is at best flat and is maybe even starting to decline,'' said David Wyss, senior economist at Standard & Poor's in New York. ``We face the possibility that the first part of next year could turn into recession.''
Stocks fell and U.S. Treasury securities gained after the reports. The yield on the benchmark 10-year note dropped 9 basis points to 3.94 percent as of 10:21 a.m. in New York.
Economists had expected the manufacturing gauge to fall to 50.5, according to the median of 69 forecasts in a Bloomberg News survey. Estimates ranged from 48.9 to 52.
The index averaged 52.2 last year, down from 53.9 in 2006.
New Orders Decline
The decrease in today's overall manufacturing index reflected a decline in new orders to the lowest level since October 2001. ISM's new orders index fell to 45.7 from 52.6. The production measure fell to 47.3 from 51.9.
The group's gauge of prices paid rose to 68 from 67.5. Economists surveyed by Bloomberg had expected the measure to fall to 65....
The ISM report follows others that show manufacturing weakening. The Philadelphia Federal Reserve's business gauge for December contracted for the first time in a year and the Richmond Fed's measure also was negative.
Orders for durable goods excluding transport equipment fell 0.7 percent in November, held back by a drop in defense procurement and machinery demand, the Commerce Department said on Dec. 27....
Stockpile building added 0.89 percentage point to 3rd quarter economic growth....Slower consumers spending and continued housing weakness the last 3 months of the year probably brought down economic growth in the quarter to a 1% pace, 1/5 the rate it did from July through September, according to a Bloomberg News survey taken last month.
The ISM's gauge of export orders fell to 52.5, from 58.5....
``We are seeing the U.S. economy slowing,'' said Alexander M. Cutler, chief executive officer at Eaton Corp., in a Dec. 21 interview. There is the ``potential that industrial production could move to flat to slightly negative in the first quarter.''
Some companies are trimming their spending. FedEx Corp., the second-biggest U.S. package-delivery company, lowered its capital spending forecast for the full year by 11 percent, to $3.1 billion, and said additional reductions are ``possible'' as executives review the timing of spending plans.
Illinois Tool Works Inc., the maker of Duo-Fast nail guns and Wilsonart countertops, last month cut its full-year earnings forecast, in part because of lower-than-expected sales in North America. Also Black & Decker said that retailers placed fewer orders last quarter because consumers are buying fewer tools for home remodeling projects as the housing slump enters its third year.
Some companies are preparing for a slowdown by cutting back on hiring or trimming their payrolls.
The ISM's employment measure rose to 48 from 47.8 in November, which was the lowest in four years.
The government is scheduled to release the December employment report on Jan. 4. The number of Americans who continued to collect unemployment benefits...rose to a two-year high in the week ended Dec. 15, the Labor Department said on Dec. 27."
U.S. Manufacturing Contracted in December
By Courtney Schlisserman
Jan. 2, 2008
"Manufacturing in the U.S. unexpectedly shrank the most in almost 5 years....
The Institute for Supply Management's manufacturing index dropped to 47.7, the lowest reading since April 2003, from 50.8 the prior month....50 is the dividing line between contraction and expansion.
Manufacturing is near stalling as the housing recession extends beyond building-related industries to affect credit standards and consumer and business spending plans. Slower factory production and company spending will weigh on economic growth.
``We're getting down to that area where manufacturing is at best flat and is maybe even starting to decline,'' said David Wyss, senior economist at Standard & Poor's in New York. ``We face the possibility that the first part of next year could turn into recession.''
Stocks fell and U.S. Treasury securities gained after the reports. The yield on the benchmark 10-year note dropped 9 basis points to 3.94 percent as of 10:21 a.m. in New York.
Economists had expected the manufacturing gauge to fall to 50.5, according to the median of 69 forecasts in a Bloomberg News survey. Estimates ranged from 48.9 to 52.
The index averaged 52.2 last year, down from 53.9 in 2006.
New Orders Decline
The decrease in today's overall manufacturing index reflected a decline in new orders to the lowest level since October 2001. ISM's new orders index fell to 45.7 from 52.6. The production measure fell to 47.3 from 51.9.
The group's gauge of prices paid rose to 68 from 67.5. Economists surveyed by Bloomberg had expected the measure to fall to 65....
The ISM report follows others that show manufacturing weakening. The Philadelphia Federal Reserve's business gauge for December contracted for the first time in a year and the Richmond Fed's measure also was negative.
Orders for durable goods excluding transport equipment fell 0.7 percent in November, held back by a drop in defense procurement and machinery demand, the Commerce Department said on Dec. 27....
Stockpile building added 0.89 percentage point to 3rd quarter economic growth....Slower consumers spending and continued housing weakness the last 3 months of the year probably brought down economic growth in the quarter to a 1% pace, 1/5 the rate it did from July through September, according to a Bloomberg News survey taken last month.
The ISM's gauge of export orders fell to 52.5, from 58.5....
``We are seeing the U.S. economy slowing,'' said Alexander M. Cutler, chief executive officer at Eaton Corp., in a Dec. 21 interview. There is the ``potential that industrial production could move to flat to slightly negative in the first quarter.''
Some companies are trimming their spending. FedEx Corp., the second-biggest U.S. package-delivery company, lowered its capital spending forecast for the full year by 11 percent, to $3.1 billion, and said additional reductions are ``possible'' as executives review the timing of spending plans.
Illinois Tool Works Inc., the maker of Duo-Fast nail guns and Wilsonart countertops, last month cut its full-year earnings forecast, in part because of lower-than-expected sales in North America. Also Black & Decker said that retailers placed fewer orders last quarter because consumers are buying fewer tools for home remodeling projects as the housing slump enters its third year.
Some companies are preparing for a slowdown by cutting back on hiring or trimming their payrolls.
The ISM's employment measure rose to 48 from 47.8 in November, which was the lowest in four years.
The government is scheduled to release the December employment report on Jan. 4. The number of Americans who continued to collect unemployment benefits...rose to a two-year high in the week ended Dec. 15, the Labor Department said on Dec. 27."