The June ISM Manufacturing data came in weaker than expected, with a reading of 48.5 versus the anticipated 49.1. Stocks (^DJI, ^IXIC, ^GSPC) are trading higher on the heels of the report.
Catalyst anchors Brad Smith and Madison Mills break down the details of the print.
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This post was written by Angel Smith
Video Transcript
Breaking news we have here which is manufacturing data from ISM coming in at 48.5 versus the 49.1 that investors were anticipating the im manufacturing prices paid the lowest of the year here coming in lower than previously.
The previous low came in in March of this year.
Actually, the previous high rather came in in March of this year.
So see continued weakness here.
Also taking a look at some of the that could play into some of the jobs data we get later this week, we saw employment falling to 49.3 versus 51.1.
Now we did see new orders rising to 49.3 versus 45.4.
So see a little bit of a mixed picture when you look at that price is paid, also fell to 52.1 versus 57.
That is the lowest reading since December.
So see perhaps a little bit of cooling there.
Really interesting though Brad to see that number falling to 49.3 versus 51.1.
Obviously, that’s not a huge amount of coolness, but that could be enough to fuel some of the data that we’re expecting later this week when we get that key jobs report.
Yes, net net.
This is a continuation of the contraction that we’ve seen.
You got a comment here from Timothy Fiore who is the chair of the Institute for Supply Management is M and essentially saying us manufacturing activity continued in contraction.
At the close of the second quarter, demand was weak.
Again, output declined, inputs stayed accommodative now, demand slowing was reflected by a few things.
One of them being new orders index improving to marginal contraction, new export orders index returning to contraction and then the backlog of orders.
He also notes dropping into stronger contraction territory.
So all this considered output that remained in decline actually declined compared to May I A combined 3.5% point downward impact on the manufacturing PM I calculation here.
And it looks like we’re seeing gains across the major indices including the NASDAQ flipping back into positive territory after getting pushed to the downside a little bit earlier, those stocks for coming here after we got that IM data.
Now the big question, could markets be prone to a correction in the coming months after the record breaking gains that we saw in the first half of this year.
