ISM:"The manufacturing sector enjoyed its best month since December 1983"

ISM ^ | December 1, 2003 | ISM

[RobFromGa]

November Manufacturing ISM Report On Business®

PMI at 62.8%

Production, New Orders, Employment Grow
Inventories Unchanged
Supplier Deliveries Slower

(Tempe, Arizona) — Economic activity in the manufacturing sector grew in November for the fifth consecutive month, while the overall economy grew for the 25th consecutive month, say the nation's supply executives in the latest Manufacturing ISM Report On Business®.

The report was issued today by Norbert J. Ore, C.P.M., chair of the Institute for Supply Management™ Manufacturing Business Survey Committee and group director, strategic sourcing and procurement, Georgia-Pacific Corporation. "The manufacturing sector enjoyed its best month since December 1983. The big improvement is in Employment as the index rose above 50 percent, indicating growth, following 37 consecutive months of decline. The momentum is coming from continued strength in New Orders and Production as the indexes are presently at very lofty levels."

Backlog of Orders Index indicates that order backlogs increased in November, and the Employment Index reversed a long-term trend of contraction as it indicates growth during the month. ISM's Prices Index indicates that manufacturers experienced higher prices in their purchases. The New Export Orders and Import Indexes continue to grow.

Comments from purchasing and supply managers are more upbeat this month as various industry segments are starting to see improvement. While overall employment appears to be improving, respondents still mention current or impending layoffs. Several indicate transferring production of "product lines" to offshore manufacturing.

ISM's PMI registered 62.8 percent in November, an increase of 5.8 percentage points when compared to 57 percent in October. ISM's New Orders Index rose 9.4 percentage points from 64.3 percent in October to 73.7 percent in November. ISM's Production Index rose 5.7 percentage points from 62.6 percent in October to 68.3 percent in November. The ISM Employment Index is at 51 percent for November, an increase of 3.3 percentage points when compared to the 47.7 percent reported in October.

ISM's Supplier Deliveries Index registered 56 percent, 2.1 percentage points higher than October's 53.9 percent. ISM's Inventories Index registered 50 percent in November, up from the 44.5 percent reported in October. ISM's Customers' Inventories Index for November is at 39.5 percent, an increase of 0.5 percentage point compared to the October reading of 39 percent. ISM's Prices Index in November is 64 percent, 5.5 percentage points higher than the 58.5 percent reported in October.

ISM's Backlog of Orders Index increased 5.5 percentage points, registering 59 percent in November compared to 53.5 percent in October. ISM's New Export Orders Index registered 57.9 percent, a decrease of 1.7 percentage points from October's 59.6 percent. ISM's Imports Index increased 5.1 percentage points to 62.4 percent in November, up from 57.3 percent in October.

"Based on this data, it appears that the recovery is gaining momentum. Indications are that the manufacturing sector is ending 2003 on a very positive note, and all of the indexes support continued strength into 2004. While there are still companies lagging the recovery, they should be encouraged by the current indicators in the sector," said Ore.

Of the 20 industries in the manufacturing sector, 18 industries reported growth: Instruments & Photographic Equipment; Glass, Stone, & Aggregate; Leather; Electronic Components & Equipment; Tobacco; Industrial & Commercial Equipment & Computers; Primary Metals; Food; Transportation & Equipment; Fabricated Metals; Wood & Wood Products; Textiles; Furniture; Miscellaneous*; Printing & Publishing; Chemicals; Apparel; and Rubber & Plastic Products.

"Plywood is the only commodity reported in short supply. Commodities reported up in price are: Aluminum; Beef; Brass; Caustic Soda; Copper; Electrical Components; Lumber; Natural Gas; Nickel; Plastic Resins; Plywood; Polyethylene; Resin; Stainless Steel; and Steel. The commodities reported down in price are Caustic Soda; Corrugated Cartons; and Natural Gas," Ore stated. "Caustic Soda and Natural Gas are reported as both up and down in price."

NOVEMBER 2003 ISM BUSINESS SURVEY AT A GLANCE

	Series Index	Direction Nov vs Oct	Rate of Change Nov vs Oct
PMI	62.8	Growing	Faster
New Orders	73.7	Growing	Faster
Production	68.3	Growing	Faster
Employment	51.0	Growing	From Contracting
Supplier Deliveries	56.0	Slowing	Faster
Inventories	50.0	Unchanged	From Contracting
Customers' Inventories	39.5	Too Low	Slower
Prices	64.0	Increasing	Faster
Backlog of Orders	59.0	Growing	Faster
New Export Orders	57.9	Growing	Slower
Imports	62.4	Growing	Faster

THE ECONOMY AT A GLANCE

Overall Economy	Growing	Faster
Manufacturing	Growing	Faster

PMI

The PMI indicates that the manufacturing economy grew in November for the fifth consecutive month. The PMI for November registered 62.8 percent, an increase of 5.8 percentage points compared to the October reading of 57 percent. A reading above 50 percent indicates that the manufacturing economy is generally expanding; below 50 percent indicates that it is generally contracting.

A PMI in excess of 42.9 percent, over a period of time, generally indicates an expansion of the overall economy. The November PMI indicates that both the overall economy and the manufacturing sector are growing. The past relationship between the PMI and the overall economy indicates that the average PMI for January through November (52.3 percent) corresponds to a 3.4 percent increase in real gross domestic product (GDP). However, if the PMI for November (62.8 percent) is annualized, this corresponds to a 7.3 percent increase in GDP.

Month	Nov'03	Oct'03	Sep'03	Aug'03	Jul'03
PMI%	62.8	57.0	53.7	54.7	51.8
Month	Jun'03	May'03	Apr'03	Mar'03	Feb'03
PMI%	49.8	49.4	45.4	46.2	50.5
Month	Jan'03	Dec'02	Nov'02	Oct'02	Sep'02
PMI%	53.9	55.2	50.5	49.7	50.7

New Orders

ISM's New Orders Index grew in November with a reading of 73.7 percent. The index is 9.4 percentage points higher than the 64.3 percent registered in October and is the seventh consecutive month the index has exceeded 50 percent. This is the highest the index has been since December 1983, when the index registered 74.8 percent. A New Orders Index above 51 percent, over time, is generally consistent with an increase in the Census Bureau's series on manufacturing orders (in constant 1987 dollars). Sixteen industries report increases for the month of November: Instruments & Photographic Equipment; Glass, Stone, & Aggregate; Primary Metals; Electronic Components & Equipment; Industrial & Commercial Equipment & Computers; Textiles; Rubber & Plastic Products; Wood & Wood Products; Fabricated Metals; Transportation & Equipment; Furniture; Printing & Publishing; Food; Miscellaneous*; Chemicals; and Paper.

New Orders	%Better	%Same	%Worse	Net	Index
November 2003	45	43	12	+33	73.7
October 2003	37	48	15	+22	64.3
September 2003	38	46	16	+22	60.4
August 2003	35	48	17	+18	59.6

Production

ISM's Production Index is 68.3 percent in November, 5.7 percentage points higher than the 62.6 percent reported in October, reflecting the seventh consecutive month of growth. An index above 49.9 percent, over time, is generally consistent with an increase in the Federal Reserve Board's Industrial Production figures. Of the 20 industries reporting in November, 16 registered growth: Tobacco; Instruments & Photographic Equipment; Glass, Stone, & Aggregate; Electronic Components & Equipment; Food; Textiles; Primary Metals; Fabricated Metals; Furniture; Industrial & Commercial Equipment & Computers; Printing & Publishing; Chemicals; Miscellaneous*; Wood & Wood Products; Transportation & Equipment; and Paper.

Production	%Better	%Same	%Worse	Net	Index
November 2003	40	49	11	+29	68.3
October 2003	35	51	14	+21	62.6
September 2003	33	53	14	+19	57.3
August 2003	33	52	15	+18	61.6

Employment

ISM's Employment Index reversed a 37-month trend of contraction as the index registered 51 percent in November compared to 47.7 percent in October, an increase of 3.3 percentage points. An Employment Index above 47.8 percent, over time, is generally consistent with an increase in the Bureau of Labor Statistics (BLS) data on manufacturing employment. The eight industries reporting growth in employment during November are: Leather; Transportation & Equipment; Glass, Stone, & Aggregate; Wood & Wood Products; Instruments & Photographic Equipment; Fabricated Metals; Industrial & Commercial Equipment & Computers; and Food.

Employment	%Higher	%Same	%Lower	Net	Index
November 2003	16	66	18	-2	51.0
October 2003	15	63	22	-7	47.7
September 2003	12	66	22	-10	45.7
August 2003	12	67	21	-9	45.9

[RobFromGa]

The good news continues.

[RobFromGa]

The big improvement is in Employment as the index rose above 50 percent, indicating growth, following 37 consecutive months of decline. The momentum is coming from continued strength in New Orders and Production as the indexes are presently at very lofty levels."

The "jobless recovery" is now spawning jobs.

[Grampa Dave]

Thanks for posting the good news.

The good news at this time is being received well in the USA markets:

http://bigcharts.marketwatch.com/markets/indexes.asp

[xrp]

Did Tom Daschle happen to comment?

[RobFromGa]

Maybe we'll break 2000 (Nasdaq) and 10,000 (DJIA) this week, that would be a good start to the Holiday season.

[Peach]

A great news bump

[jla]

^

[Grampa Dave]

More good news, so expect the stringers for $oreA$$ to post their gloom and doom replies.

Do these stringers get paid per reply or per day?

[randog]

Did Tom Daschle happen to comment?

The DNC is busy crafting his (and other leftists) responses:

1) "Although this is good news for working Americans, the failure of the Administration to..."
2) "This is good news for working families, but there are still millions left behind by..."
3) "This news undoubtedly brings much joy to many working families across America, but I am deeply saddened by..."

Take your pick.

[Grampa Dave]

Expect huge short selling resistance from the rats and their mentor George $oreA$$ to slow/preventing us from breaking the Dow 10000.

Also, the only thing has brought the market down for about a week since August has been the monthly release of the supposedly new Benny Laden tape or $oddomite tape and the terrorist attack in Turkey last month

Normally this has happened in the middle of the month. I think that $oreA$$ will order his buddies to release the newest phoney tape early in the month. We will probably see $oreA$$'s al Qaeda thugs attack another ally this month to bring the markets down around the world.

Regardless when it is all over, we will be very close to the 10 K mark for the Dow.

[Coop]

Maybe we'll break 2000 (Nasdaq) and 10,000 (DJIA) this week, that would be a good start to the Holiday season.

Arrrgghhh!!! This must be the tenth "Dow 10,000" prediction/request I've seen, and every time it seems the market drops back to 9700 or so.

[steveegg]

Did Tom Daschle happen to comment?

Daschle - I am deeply saddened to hear that
we've had the best month economically since
Reagan. I WANT MY MOMMY!!!

[Petronski]

Sounds like a 'manufacturing bubble.' Better buy gold. Lots of gold.

[snicker]

[steveegg]

I'd imagine that a$$ is sore considering where it's been planted (does crusty black pantsuit ring a bell?)

[RobFromGa]

Busiest IPO Month In Past Two Years; Profits Are Key Now

BY KEN HOOVER

INVESTOR'S BUSINESS DAILY

The new issues market heated up in November as 15 companies came public, the most in two years, according to Renaissance Capital of Greenwich, Conn., which tracks and invests in IPOs.

Renaissance portfolio manager Kathleen Smith sees a solid 10 or more deals in December, a month usually hobbled by the holiday season.

But it's still nothing like the high-flying days of 1999 and early 2000, when investors threw money at any offering with dot-com in its name, whether it made a nickel in profit or ever would.

"The most interesting thing about this market is that it's finicky," Smith said. "Investors aren't gobbling up everything in sight."

The one industry group without earnings is biotech, and the flow of biotech issues has been particularly slow, Smith said.

"That tells you there's some discipline out there," she said.

[Smile-n-Win]

Do these stringers get paid per reply or per day?

Whichever it is, it looks like $ore@$$ is investing into the flop of the millennium! Here's to hope he'll lose all his money one day.

[cp124]

Manufacturing still dead in Peoples Republic of New England.

[discostu]

How is this possible? I have it on good authority that we've exported our entire manufacturing sector and no longer have the capability of even making staplers. Are you trying to tell me that the doom and gloomers are wrong?

[.cnI redruM]

We still have one. It just hires illegals for pennies and hour and beats the bottoms of their feet if they work less than 14 hour days in environmentally unsafe conditions that violate OSHA standards and pollutes the air. WE"RE ALL DOOMED!!!!!!!!!!!!!!!!!!!!!!!!!!!!

Now you no longer have to ping the 'Fair Trade' nut-bags.

[Grampa Dave]

We can hope that he gets busted hard trying bust the dollar, now with the pound after he failed with the Euro.

Eventually, we will probably be able to see how his various hedge funds have been involved in short selling to prevent the Dow from advancing this year. A lot of us wonder if any of the hedge funds connected to him were involved in the after hours trading at the mutual fund companies which have been caught allowing this.