Trade Resources Industry Views Manufacturing in The U. S. Grew in January at The Fastest Pace in Seven Months

Manufacturing in The U. S. Grew in January at The Fastest Pace in Seven Months

Manufacturing in the U. S. Grew in January at the fastest pace in seven months, adding to signs of a global pickup from Germany to China. The Institute for Supply Management’s index climbed to 54.1, from 53.1 in December, the Tempe, Arizona-based group’s report showed today. Figures greater than 50 signal expansion. Other reports showed U. S. Construction spending increased at the fastest pace in four months and companies added 170, 000 workers to payrolls in January. Stocks rose on optimism the factory reports show the world economy is withstanding fallout from Europe’s debt crisis. Production, led by inventory rebuilding at the end of 2011, is poised to keep expanding in the U. S. As the need to update equipment drives orders at companies like Caterpillar Inc. (CAT) and demand for cars rises. U. S. “manufacturing growth points to an acceleration in the economy, ” said Conrad DeQuadros, a senior economist at RDQ Economics LLC in New York. “China is weathering weaker activity in Europe quite well. ” The Standard & Poor’s 500 Index climbed 0.9 percent to 1, 324.08 at the close in New York. The Stoxx Europe 600 Index advanced 2 percent. The yield on the benchmark 10-year U. S. Treasury note rose to 1.83 percent from 1.8 percent late yesterday. China, Europe Factory indexes in China improved last month as the world’s second-biggest economy withstood exports weakened by Europe’s crisis. The official purchasing managers’ index increased to 50.5, from 50.3 in December. The data may have been distorted by a weeklong holiday. In Germany, Europe’s largest economy, output grew for the first time since September. In the U. K., manufacturing returned to growth in January after shrinking in the previous three months. Across the euro region, manufacturing contracted less than initially estimated as a gauge based on a survey of purchasing managers rose to 48.8 from 46.9 the previous month, London-based Markit Economics said today. The median forecast for the ISM index among 80 economists surveyed by Bloomberg News was 54.5. Estimates ranged from 53 to 56. Caterpillar, the largest construction and mining-equipment maker, last month posted fourth-quarter earnings and forecast full-year profit that topped analysts’ estimates as demand rose for earth-moving machinery and trucks. The Peoria, Illinois- based manufacturer said it had a record $29.8 billion backlog of orders at the end of 2011. Auto Sales Chrysler Group LLC, the automaker majority owned by Fiat SpA, said today that U. S. Sales rose 44 percent last month from the same time last year, joining Nissan Motor Co. And General Motors Co. In beating analysts’ estimates for January. Cars and light trucks sold at a 14.1 million annual rate last month, according to industry data. Excluding a surge in August 2009 that reflected the government’s “cars-for- clunkers” program, it was the strongest month since May 2008. The ISM’s new orders measure climbed to 57.6, the highest since April, from 54.8, and the gauge of export orders rose. Manufacturing accounts for about 12 percent of the economy and was at the forefront of the recovery that began in June 2009. Federal Reserve officials said in their policy statement last month that they may leave interest rates low until 2014, in part because “strains in global financial markets continue to pose significant downside risks to the economic outlook. ” More Jobs Employment at companies climbed 170, 000 in January, according to data today by Roseland, New Jersey-based ADP Employer Services. The gain compared with a median forecast of 182, 000 in a Bloomberg survey of economists and followed a revised 292, 000 rise the prior month that was smaller than previously reported. Construction spending increased 1.5 percent in December, the biggest gain since August, helped by a jump in non- residential construction, Commerce Department figures showed today. The median estimate of 51 economists in a Bloomberg survey called for a 0.5 percent rise. Source: bloomberg.com

Source: http://www.bloomberg.com/news/2012-02-01/u-s-manufacturing-increases-at-a-faster-pace-as-ism-index-climbs-to-54-1.html
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Manufacturing in U.S. Bolsters Global Expansion Economy