Canaccord Genuity Morning Coffee on U.S. ISM: Look Out Below
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Price: $54.02 +0.60%
Rating Summary:
6 Buy, 12 Hold, 3 Sell
Rating Trend: = Flat
Today's Overall Ratings:
Up: 8 | Down: 12 | New: 30
Rating Summary:
6 Buy, 12 Hold, 3 Sell
Rating Trend: = Flat
Today's Overall Ratings:
Up: 8 | Down: 12 | New: 30
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Canaccord Genuity Morning Coffee on U.S. ISM: Look out below.
Manufacturing in the U.S. unexpectedly shrank in June for the first time in almost three years, indicating a mainstay of the expansion may be faltering. The Institute for Supply Management’s index fell to a disappointing 49.7, which was worse than the most-pessimistic forecast in a Bloomberg News survey. Any figures below 50 signal a contraction. Measures of orders, production and export demand also dropped to three-year lows. Assembly lines look to be slowing as consumers temper purchases of vehicles and other goods and companies limit investments in new equipment. At the same time, export markets for manufacturers like DuPont (NYSE: DD) and Steelcase (NYSE: SCS) are finding it more difficult as Europe struggles with a debt crisis and Asian economies including China weaken. Consensus forecast in a Bloomberg survey called for a decline to 52. Estimates of 70 economists ranged from 50.5 to 53.5. Credit Suisse noted that today’s move in the ISM, surely makes QE3 in the U.S. more probable. Sectors most sensitive to the ISM number include financials, mining, capital goods and semiconductors.
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Manufacturing in the U.S. unexpectedly shrank in June for the first time in almost three years, indicating a mainstay of the expansion may be faltering. The Institute for Supply Management’s index fell to a disappointing 49.7, which was worse than the most-pessimistic forecast in a Bloomberg News survey. Any figures below 50 signal a contraction. Measures of orders, production and export demand also dropped to three-year lows. Assembly lines look to be slowing as consumers temper purchases of vehicles and other goods and companies limit investments in new equipment. At the same time, export markets for manufacturers like DuPont (NYSE: DD) and Steelcase (NYSE: SCS) are finding it more difficult as Europe struggles with a debt crisis and Asian economies including China weaken. Consensus forecast in a Bloomberg survey called for a decline to 52. Estimates of 70 economists ranged from 50.5 to 53.5. Credit Suisse noted that today’s move in the ISM, surely makes QE3 in the U.S. more probable. Sectors most sensitive to the ISM number include financials, mining, capital goods and semiconductors.
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