Submitted by Mark Hanna
Courtesy of MarketMontage. View original post here.
Thus far the market is reacting very little but a quite solid number out of ISM Non Manufacturing – the second month of quite expansionary data. 55.1 versus 53.7 last month while the data in the sub indexes was mixed: new orders +4, employment -2.7, and prices +3.8.
There were also the ADP employment figures this morning but it has been so far off the official data the past few months no one is taking much stock in it.
Via ISM:
“The NMI™ registered 55.1 percent in September, 1.4 percentage points higher than the 53.7 percent registered in August. This indicates continued growth this month at a faster rate in the non-manufacturing sector. The Non-Manufacturing Business Activity Index registered 59.9 percent, which is 4.3 percentage points higher than the 55.6 percent reported in August, reflecting growth for the 38th consecutive month. The New Orders Index increased by 4 percentage points to 57.7 percent. The Employment Index decreased by 2.7 percentage points to 51.1 percent, indicating growth in employment for the second consecutive month but at a slower rate. The Prices Index increased 3.8 percentage points to 68.1 percent, indicating higher month-over-month prices when compared to August. According to the NMI™, 12 non-manufacturing industries reported growth in September. Respondents’ comments continue to be mixed; however, the majority indicate a slightly more positive perspective on current business conditions.”
WHAT RESPONDENTS ARE SAYING …
- “Business remains steady — optimistic for good fourth quarter.” (Information)
- “Drought is putting pressure on food cost; tourism slowdown over the summer.” (Arts, Entertainment & Recreation)
- “Things feel like the economy is moving. More new small business; unemployment declining; stock market up.” (Health Care & Social Assistance)
- “Economic outlook is improving, but company is putting a major effort into more cost reductions and reorganization, resulting in more collaboration between procurement and our internal customers.” (Professional, Scientific & Technical Services)
- “The general slowdown which began in March showed some reversal in August.” (Wholesale Trade)
| ISM NON-MANUFACTURING SURVEY RESULTS AT A GLANCE COMPARISON OF ISM NON-MANUFACTURING AND ISM MANUFACTURING SURVEYS* SEPTEMBER 2012 |
|||||||||
|---|---|---|---|---|---|---|---|---|---|
| Non-Manufacturing | Manufacturing | ||||||||
| Index | Series Index Sep |
Series Index Aug |
Percent Point Change |
Direction | Rate of Change |
Trend** (Months) |
Series Index Sep |
Series Index Aug |
Percent Point Change |
| NMI™/PMI™ | 55.1 | 53.7 | +1.4 | Growing | Faster | 33 | 51.5 | 49.6 | +1.9 |
| Business Activity/Production | 59.9 | 55.6 | +4.3 | Growing | Faster | 38 | 49.5 | 47.2 | +2.3 |
| New Orders | 57.7 | 53.7 | +4.0 | Growing | Faster | 38 | 52.3 | 47.1 | +5.2 |
| Employment | 51.1 | 53.8 | -2.7 | Growing | Slower | 2 | 54.7 | 51.6 | +3.1 |
| Supplier Deliveries | 51.5 | 51.5 | 0.0 | Slowing | Same | 2 | 50.3 | 49.3 | +1.0 |
| Inventories | 48.5 | 52.5 | -4.0 | Contracting | From Growing | 1 | 50.5 | 53.0 | -2.5 |
| Prices | 68.1 | 64.3 | +3.8 | Increasing | Faster | 3 | 58.0 | 54.0 | +4.0 |
| Backlog of Orders | 48.0 | 50.5 | -2.5 | Contracting | From Growing | 1 | 44.0 | 42.5 | +1.5 |
| New Export Orders | 50.5 | 52.0 | -1.5 | Growing | Slower | 3 | 48.5 | 47.0 | +1.5 |
| Imports | 50.0 | 49.5 | +0.5 | Unchanged | From Contracting | 1 | 49.5 | 49.0 | +0.5 |
| Inventory Sentiment | 65.0 | 67.0 | -2.0 | Too High | Slower | 184 | N/A | N/A | N/A |
| Customers’ Inventories | N/A | N/A | N/A | N/A | N/A | N/A | 49.5 | 49.0 | +0.5 |
* Non-Manufacturing ISM Report On Business® data is seasonally adjusted for Business Activity, New Orders, Prices and Employment. Manufacturing ISM Report On Business® data is seasonally adjusted for New Orders, Production, Employment and Supplier Deliveries.
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Any securities mentioned on this page are not held by the author in his personal portfolio. Securities mentioned may or may not be held by the author in the mutual fund he manages, the Paladin Long Short Fund (PALFX). For a list of the aforementioned fund’s holdings at the end of the prior quarter, visit the Paladin Funds website at http://www.paladinfunds.com/holdings/blog
