Submitted by Mark Hanna
Courtesy of MarketMontage. View original post here.
Pretty hectic three day swing here – Friday gap and go to the upside, Monday gap and go to the downside, and thus far Tuesday gap and go back to the upside. Not sure what is driving things this morning other than the yen falling on its face yet again.
ISM Non Manufacturing just came in more or less in line and nicely expansionary. A bit above expectations but below December’s levels, but a solid number. New orders fell sharply however but employment up decently. Full report here.
“The NMI™ registered 55.2 percent in January, 0.5 percentage point lower than the seasonally adjusted 55.7 percent registered in December. This indicates continued growth at a slightly slower rate in the non-manufacturing sector. The Non-Manufacturing Business Activity Index registered 56.4 percent, which is 4.4 percentage points lower than the seasonally adjusted 60.8 percent reported in December, reflecting growth for the 42nd consecutive month. The New Orders Index decreased by 3.9 percentage points to 54.4 percent, and the Employment Index increased 2.2 percentage points to 57.5 percent, indicating growth in employment for the sixth consecutive month. The Prices Index increased 1.9 percentage points to 58 percent, indicating prices increased at a faster rate in January when compared to December. According to the NMI™, eight non-manufacturing industries reported growth in January. Respondents’ comments are mixed about the economy and business conditions; however, the majority of respondents are optimistic about the overall direction.”
WHAT RESPONDENTS ARE SAYING …
- “Sales are up slightly compared to this same period last year. This is offset by slight increases in costs for personnel benefits, fuel and other operating costs.” (Public Administration)
- “Business is good, but we find ourselves in a very competitive environment.” (Construction)
- “No change in business levels since prior month, but optimism growing that commercial and industrial construction will experience growth in 2013.” (Real Estate, Rental & Leasing)
- “Healthcare reform causing continued slowdown and less investment.” (Health Care & Social Assistance)
- “Seeing increasing prices on services and goods — some not substantiated. Business outlook continues to show small signs of improvement in parts of our business, but other parts are lagging behind.” (Professional, Scientific & Technical Services)
- “There seems to be some stabilization in recent months. Business seems a little more confident, and consumers are participating once again.” (Retail Trade)
- “Business is slightly softer than this time last year, but there are a lot of projects on the horizon which gives us confidence.” (Wholesale Trade)
| ISM NON-MANUFACTURING SURVEY RESULTS AT A GLANCE COMPARISON OF ISM NON-MANUFACTURING AND ISM MANUFACTURING SURVEYS* JANUARY 2013 |
|||||||||
|---|---|---|---|---|---|---|---|---|---|
| Non-Manufacturing | Manufacturing | ||||||||
| Index | Series Index Jan |
Series Index Dec |
Percent Point Change |
Direction | Rate of Change |
Trend** (Months) |
Series Index Jan |
Series Index Dec |
Percent Point Change |
| NMI™/PMI™ | 55.2 | 55.7 | -0.5 | Growing | Slower | 37 | 53.1 | 50.2 | +2.9 |
| Business Activity/Production | 56.4 | 60.8 | -4.4 | Growing | Slower | 42 | 53.6 | 52.6 | +1.0 |
| New Orders | 54.4 | 58.3 | -3.9 | Growing | Slower | 42 | 53.3 | 49.7 | +3.6 |
| Employment | 57.5 | 55.3 | +2.2 | Growing | Faster | 6 | 54.0 | 51.9 | +2.1 |
| Supplier Deliveries | 52.5 | 48.5 | +4.0 | Slowing | From Faster | 1 | 53.6 | 53.7 | -0.1 |
| Inventories | 47.0 | 50.0 | -3.0 | Contracting | From Unchanged | 1 | 51.0 | 43.0 | +8.0 |
| Prices | 58.0 | 56.1 | +1.9 | Increasing | Faster | 40 | 56.5 | 55.5 | +1.0 |
| Backlog of Orders | 49.0 | 49.5 | -0.5 | Contracting | Faster | 2 | 47.5 | 48.5 | -1.0 |
| New Export Orders | 55.5 | 49.5 | +6.0 | Growing | From Contracting | 1 | 50.5 | 51.5 | -1.0 |
| Imports | 51.0 | 49.0 | +2.0 | Growing | From Contracting | 1 | 50.0 | 51.5 | -1.5 |
| Inventory Sentiment | 64.0 | 58.0 | +6.0 | Too High | Faster | 188 | N/A | N/A | N/A |
| Customers’ Inventories | N/A | N/A | N/A | N/A | N/A | N/A | 48.5 | 47.0 | +1.5 |
* 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.
** Number of months moving in current direction.
Indexes reflect newly released seasonal adjustment factors.
Disclosure Notice
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
