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Services ISM Modestly Beats Expectations, Reports No Commodities Declined In Price
In the too little too late department, the ISM just released its Non-Manufacturing report on business, which was probably the first actual economic beat of the last week, coming at 54.6 on expectations of 54.0, up from 52.8 previously. That this was merely a countertrend bounce in what is now a secular decline from the 60 top in Q1 2011 is largely irrelevant, and just like the Mfg ISM which we now expect will drop under 50 in two months or less, the Services ISM will follow suit. For the consumer discretionary bulls out there, we would like to note that of the 18 industries that are reported in the index, only two reported contraction: Educational Services and Retail Trade. Of course, that would be retail for the lower and middle classes. The Tiffany's of the world will certainly not have any such problems until the next GFC.
Some tidbits from the respondents:
- "Business is O.K. Fuel prices and truck availability are starting
to be a negative force on our supply chain." (Agriculture, Forestry,
Fishing & Hunting) - "Business conditions are stabilized." (Health Care & Social Assistance)
- "First and second quarters of 2011 have been up 25 percent over
2010; however, we expect a slight slowdown over the summer months."
(Professional, Scientific & Technical Services) - "Uncertainty within commodity markets, especially fuel- and
oil-based products, is putting pressure once again and forcing us to
retrench as we look for stability. We expect the remainder of 2011 and
at least the first two quarters of 2012 to be tumultuous." (Retail
Trade) - "Volatile commodity prices adding stress to meat and dairy
producers; increasing fuel prices are a problem for many." (Wholesale
Trade)
Odd then that so few respondents are seeing modest commodity price impact when one paragraph down we read the following:
Commodities Up in Price
Adhesives; Air Freight (2); Aircraft Parts; Airfares (6); Aluminum; Beef (2); Can Liners (2); Chemicals; Chemical Products; Coffee; Conveyor Products; Copper (4); Copper Products (6); Copper Wire; Cotton Products (9); #1 Diesel Fuel (8); #2 Diesel Fuel (11); Food Products; Fuel (17); Fuel Products; Fuel Surcharges (5); Gasoline (8); HDPE; LDPE; Latex Gloves (5); Ocean Freight; Oil; Oil Products (2); Packaging Materials (3); Paper (7); Paper Products; Petroleum Products (5); Petroleum Resin Products; Plastics (2); Plastic Products (3); Polyethylene Bags (6); Polyethylene Resins; Rubber Based Products; Steel (6); Steel Pipe and Fittings (2); Steel Products (6); Textiles (2); Transportation Costs (2); and Transportation Services.
Commodities Down in Price
No commodities are reported down in price.
Here is why the market couldn't care less about this data:
And a full breakdown:
| ISM NON-MANUFACTURING SURVEY RESULTS AT A GLANCE COMPARISON OF ISM NON-MANUFACTURING AND ISM MANUFACTURING SURVEYS* MAY 2011 |
|||||||||
|---|---|---|---|---|---|---|---|---|---|
| Non-Manufacturing | Manufacturing | ||||||||
| Index | Series Index May |
Series Index Apr. |
Percent Point Change |
Direction | Rate of Change |
Trend** (Months) |
Series Index May |
Series Index Apr. |
Percent Point Change |
| NMI/PMI | 54.6 | 52.8 | +1.8 | Growing | Faster | 18 | 53.5 | 60.4 | -6.9 |
| Business Activity/Production | 53.6 | 53.7 | -0.1 | Growing | Slower | 22 | 54.0 | 63.8 | -9.8 |
| New Orders | 56.8 | 52.7 | +4.1 | Growing | Faster | 22 | 51.0 | 61.7 | -10.7 |
| Employment | 54.0 | 51.9 | +2.1 | Growing | Faster | 9 | 58.2 | 62.7 | -4.5 |
| Supplier Deliveries | 54.0 | 53.0 | +1.0 | Slowing | Faster | 14 | 55.7 | 60.2 | -4.5 |
| Inventories | 55.0 | 55.5 | -0.5 | Growing | Slower | 4 | 48.7 | 53.6 | -4.9 |
| Prices | 69.6 | 70.1 | -0.5 | Increasing | Slower | 22 | 76.5 | 85.5 | -9.0 |
| Backlog of Orders | 55.0 | 55.5 | -0.5 | Growing | Slower | 5 | 50.5 | 61.0 | -10.5 |
| New Export Orders | 57.0 | 53.5 | +3.5 | Growing | Faster | 9 | 55.0 | 62.0 | -7.0 |
| Imports | 50.5 | 57.0 | -6.5 | Growing | Slower | 2 | 54.5 | 55.5 | -1.0 |
| Inventory Sentiment | 55.0 | 57.5 | -2.5 | Too High | Slower | 168 | N/A | N/A | N/A |
| Customers' Inventories | N/A | N/A | N/A | N/A | N/A | N/A | 39.5 | 40.5 | -1.0 |
* 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, Supplier Deliveries and Inventories.
** Number of months moving in current direction.
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Even Christina Romer is on bloomberg right now saying that US has had "bad economic data day in and day out" and that the NFP numbers were more disappointing because they were expected.
This economy is the Jack Kavorkian recovery economy.....bitterly, clinging to life ! Monedas 2011 Kavorkian refused assisted suicide option ?
Happy 80th Birthday Raul Castro....Monedas admires Barney Frank slightly more than you !
What can one expect from a nation when an electorate will repeatedly send a flunky like Anthony Weiner to Washington, cycle after cycle ?
http://images.nymag.com/images/2/daily/2010/08/20100819_weiner_250x350.jpg
What's the story on that Weiner creep ? Was he well hung or something ? Was he trollin' for trouser Trollettes ? He knew his stuff from all angles ? Sounds like he spent a lot of time squatting over and prancing in front of mirrors ! Monedas 2011 I have the distinct advantage of NOT having seen the evidence ! http://trololololololololololo.com/
A report to ensure the market to sell off, but not panic-- tempering the idiotic emotions of the market between wink wink setup for QE.
Brokers will use this to ram the market up and use the $6 Billion of POMO. Then they can go short. After all it is no fun going to the Hamptons after a loosing day (which we know doesn't happen at the top 4 firms, ever)
Got to close green, got to close green....
Mean while Dollar dropping like a Rock.
Pricing in QE3?
Never mind that, look at NFLX go! YEEHAW!
Okay, the R2K isn't even down a percent today. Amazing.
/ES bounced 10 points off low, USD off the cliff heading below 74...E/U into preposterous territory (because Greece is getting another bailout? or being foreclosed on? or some shit like that...)...and GS up $6 since news of investigation broke this week...makes perfect sense to me.
It is not about making sense. It is about Wall Street taking our money one economic report at a time.
Good is bad bad is good. Mean while the average Joe is fucked.
Def looks like PPT out in full force today, was a serious risk of a breakdown and can't have shares go down... I mean to say, allow that to happen when banksters have free money to push them higher and kill any who dare to short reality?
Services: Two UK banks today (RBS, Lloyd's) announced that they've reduced headcount by 103,000 since 08 (!)
Increasing unemployment apparently lacks relevance.
Market rallying on ISM news...
On Yahoo! it still says "stocks sharply lower on dismal jobs number."
See? A mere half of 1% decline is "sharply" lower. Must not have volitility, must not be taken off life support, must not go off the prozac, must keep every move in market as safe as a placedo....
Much like yesterday when people said gold was "crashing".
I see a $1540 London PM fix. One dollar from it's all time high. Comical.
The gap from yesterdays low has been closed (SPY, IYR, IWM, XRT). Market can continue down now after 11AM.
The ISM Service Index is really kind of a bogus index anyway........all the components are pretty worthless except is there more demand for my services or not. The inventory number???? How do you really inventory services???? Same and even more so with order backlogs???? It's really pretty worthless and has little more than zero value content.
In a whore house you count the tits and divide by a factor of two ! Monedas 2011 Comedy Jihad World Humour Inventory
Sell in June, until QE3 when commodities go to the moon!
Flat to green by days end. It's a jobless recovery. Printing press still has electricity and working fine due to the cheap labor in China.
Dupe
Anyone else notice that the banks are about the only thing green so far today? FUBAR!
The banks, being the plague infested group that they are, are ALWAYS the last group to have a positive move. When short covering is complete in that group, then comes the Screaming and Plunging phase of the market ride.
Barney Frank's tonsils are green ! It's a chronic yeast infection ! Monedas 2011 Comedy Jihad Humour Services
Regardless of what Ben the Bullshiiter says, the Bullshit level has kept pace with inflation. A 100% correlation.
Proof = MSM editorial bias (1984 doublespeak) toward non existent growth, and the ISM report being hijacked by the left wing fascists controlling the "message".
Does one have to stretch one's imagination that far to understand that 'lil Timmy and his undersized and overwrought crew of mental lilliputians get the ISM (or any figures) before they are published to the unwashed masses?
There are many factors that contributed to the "across the board" commodity price increases:
Bad weather
Earthquakes
Tsunamis
Volcanic Eruptions
Polar Shifts
Approaching comets
Speculators
Oh, did I mention speculators?
Anything except for exponential monetization of debt is an acceptable reason.
Finding and shorting Chinese frauds is turning into a nice little cottage industry. Soon everybody is going to be looking for their own.
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