Manufacturing ISM Drops To Lowest Since December, Employment Slide Biggest Since 2008

Tyler Durden's picture


Those expecting a complete collapse in the Manufacturing ISM, on par with yesterday's slide in the Chicago PMI, will have to wait some more before the complete devastation in the US manufacturing sector sends stocks into the stratosphere. Moments ago the ISM Manufacturing report for April was released, printing at a headline of 50.7, down from 51.3 and the lowest print since December 2012. The good news: it was still above 50 and beat expectations of a 50.6 print by the smallest amount possible. The bad news: it is sliding fast. The worst news: the Employment Indicator, which came at 50.2, down 4 on the month, was the lowest since November, tied with the biggest sequential drop since 2008 in absolute terms, and the biggest drop in percentage terms since the Great Financial Crisis. Judging by the stock market response, the news is not as bad as needed to send the S&P to over 1600, at least not just yet.

Headline ISM:

Employment ISM:

From the report:

The PMI™ registered 50.7 percent, a decrease of 0.6 percentage point from March's reading of 51.3 percent, indicating expansion in manufacturing for the fifth consecutive month, but at the lowest rate of the year. The New Orders Index increased in April by 0.9 percentage point to 52.3 percent, and the Production Index increased by 1.3 percentage points to 53.5 percent. The Employment Index registered 50.2 percent, a decrease of 4 percentage points compared to March's reading of 54.2 percent. The Prices Index registered 50 percent, decreasing 4.5 percentage points from March, indicating that overall raw materials prices remained unchanged from last month. Comments from the panel indicate a range of strong/steady growth, to flat/declining volumes, depending upon the particular industry."

Commodities Up in Price

  • Caustic Soda; Corrugated Boxes (9); HDPE (4); Lumber (4); Natural Gas; Plastic Resins (3); and Polypropylene (6).

Commodities Down in Price

  • Aluminum; Steel; and Steel — Cold Rolled.

What the respondents are saying:

  • "Business can be described as flat at best." (Food, Beverage & Tobacco Products)
  • "Production is still strong; several new projects to support alternative energy." (Primary Metals)
  • "Slight uptick in business, but overall continuing slowdown in defense due to budget/sequester." (Computer & Electronic Products)
  • "We have concerns about safety of doing business in South Korea. Our largest customer and part owner is in South Korea." (Electrical Equipment, Appliances & Components)
  • "Automotive demand remains firm." (Fabricated Metal Products)
  • "Business continues at a steady pace." (Machinery)
  • "General business conditions and industrial markets remain strong." (Transportation Equipment)
  • "Seasonal pick-up underway in the office furniture industry." (Furniture & Related Products)
  • "Market has slowed this month — weather in some parts of the country, also customers built inventory in anticipation of building increase, but the economy is still slow to pick up this spring." (Wood Products)
  • "Overall, volume is steady or slightly declining. Q1 sales volume is lower than projected." (Chemical Products)



Construction Spending was dismal - 3rd miss in last 4; biggest 3-month drop in 26 months, and lowest spend since Auguest 2012...


But apart from that housing's doing great...

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Wed, 05/01/2013 - 10:20 | 3517672 mattdubz86
mattdubz86's picture

bad is good, good is bad, awful is better

Wed, 05/01/2013 - 10:26 | 3517705 ihedgemyhedges
ihedgemyhedges's picture

Exports down, imports up, employment right at contraction level.  Cue Jan Hatzius........

Wed, 05/01/2013 - 10:26 | 3517723 Manthong
Manthong's picture

Try this (cut and paste).

Activity is encouraging.. output and performance remain nominally stronger though conditions appear to provide some constraints.

Wed, 05/01/2013 - 10:26 | 3517711 midtowng
midtowng's picture

This should boost stocks.

Wed, 05/01/2013 - 10:25 | 3517716 Stoploss
Stoploss's picture


Wed, 05/01/2013 - 11:23 | 3517969 somecallmetimmah
somecallmetimmah's picture

"MOARRRRRRRRRRRRRRRRRRRRR....................shaved cats!"

Wed, 05/01/2013 - 10:17 | 3517676 Shizzmoney
Shizzmoney's picture

"Business continues at a steady pace"

This has been said for the last 4 years.

Wed, 05/01/2013 - 10:31 | 3517733 spastic_colon
spastic_colon's picture

surprising the number was allowed to stay in expansion territory......wierd  /s

Wed, 05/01/2013 - 10:32 | 3517736 uno
uno's picture

"Business continues at a steady pace"

and by 'Business' they mean layoffs

Wed, 05/01/2013 - 10:31 | 3517746 azzhatter
azzhatter's picture

I turned a friend of mine on to ZH. His comment after a month of reading was "They just cherry pick bad data". I just laughed and asked him to please cherry pick good data and get back to me. He said "Simple-real estate is booming"



Wed, 05/01/2013 - 16:19 | 3519562 Freddie
Freddie's picture

With friends like that - who needs retards.

Wed, 05/01/2013 - 10:38 | 3517774 McMolotov
McMolotov's picture

Snails can move at a steady pace, too.

Wed, 05/01/2013 - 10:22 | 3517684 TeamDepends
TeamDepends's picture

Just the push we need for all-time highs...

Wed, 05/01/2013 - 10:20 | 3517690 ebworthen
ebworthen's picture

In a nation dominated by parasites and parasitic institutions we cannot expect good things for real people.

Wed, 05/01/2013 - 10:24 | 3517695 Bastiat
Bastiat's picture

In a nutshell.

Wed, 05/01/2013 - 10:33 | 3517756 pods
pods's picture

Well, me being an optimist, at least I got some huge shoulders from all this rowing?


Wed, 05/01/2013 - 13:19 | 3518640 Temporalist
Temporalist's picture

Momma used to say:

"This is why I can't have nice things!!!"

Wed, 05/01/2013 - 10:24 | 3517693 fonzannoon
fonzannoon's picture

The best part about this was watching this british penis face Simon someone on CNBC celebrate this number as "being over 50, which shows continued expansion"


Wed, 05/01/2013 - 10:21 | 3517694 Never One Roach
Never One Roach's picture

I'm picking up alot of 'Roach Chatter' [RC] today on the short wave...what does that mean?

Wed, 05/01/2013 - 10:25 | 3517703 Bastiat
Bastiat's picture

Please expand.

Wed, 05/01/2013 - 10:55 | 3517846 The Gooch
The Gooch's picture

Don't drone me, bro.

Wed, 05/01/2013 - 11:19 | 3517944 HurricaneSeason
HurricaneSeason's picture

It's probably pirate radio out of Detroit or Philly, I wouldn't worry about it.


Wed, 05/01/2013 - 10:22 | 3517696 shermacman
shermacman's picture

A wise man once said to me:
"apparently if good is good, bad is better, and totally shitty is absolutely awesome"

Wed, 05/01/2013 - 10:22 | 3517701 EmmittFitzhume
EmmittFitzhume's picture

It's hard to destroy an economy but they are doing it!

Wed, 05/01/2013 - 10:25 | 3517702 FieldingMellish
FieldingMellish's picture

The market can't take anymore good news...

Wed, 05/01/2013 - 10:23 | 3517707 GolfHatesMe
GolfHatesMe's picture

If it came in at 5 or 500, we would still close green

Wed, 05/01/2013 - 10:23 | 3517708 PaperBear
PaperBear's picture

Ben will have to reach for the QE lever.

Wed, 05/01/2013 - 10:23 | 3517709 Edward Fiatski
Edward Fiatski's picture

Hey... Tyler, Employement has been Growing for 43 consecutive months, it's just slower. :)

Wed, 05/01/2013 - 10:34 | 3517762 SheepDog-One
SheepDog-One's picture

I try to tell my girlfriend that, but she dont believe me!

Wed, 05/01/2013 - 10:25 | 3517714 kaa1016
kaa1016's picture

The initial kneejerk was to bid this market higher then we dropped. Look at currencies and commodities. Stocks are going lower.

Wed, 05/01/2013 - 10:26 | 3517719 buzzsaw99
buzzsaw99's picture

what the respondents are saying: iffin' the po don't gits mo credit they ain't gonna spend no mo

Wed, 05/01/2013 - 10:29 | 3517725 spastic_colon
spastic_colon's picture

i am shocked.......not

Wed, 05/01/2013 - 10:27 | 3517727 tip e. canoe
tip e. canoe's picture

tyler, you should pull out those gold & dow charts from 2008 again.    history may only rhyme, but in an era where history is unfolding as a replica of a replica, the rhyming is only as original as Blueprint2 by Jay-Z.

Wed, 05/01/2013 - 10:28 | 3517728 Longtermnotreally
Longtermnotreally's picture

It's almost impossible to know if these data are correct, most is just released for propaganda purposes

Wed, 05/01/2013 - 10:31 | 3517734 ThunderingTurd
ThunderingTurd's picture

I am hoping so badly that Ben issues a statement today noting that QE isn't/hasn't worked and going forward the will be stopping their easy money policies and revamping their thought process.  #hopium

Wed, 05/01/2013 - 10:41 | 3517775 Alex Kintner
Alex Kintner's picture

Let me check the Bloomberg screen. Nope, Ben has not reached Infinity yet. QE On!!

Wed, 05/01/2013 - 10:29 | 3517735 orangedrinkandchips
orangedrinkandchips's picture

US Manufacturing.......


HA! biggest.oxymoron.ever!

Wed, 05/01/2013 - 10:36 | 3517741 H E D G E H O G
H E D G E H O G's picture

"Caustic Soda; Corrugated Boxes (9); HDPE (4); Lumber (4); Natural Gas; Plastic Resins (3); and Polypropylene (6)." looks like they forgot to add small ball bearings and propane tanks to the list, which at some point in time will be essential to the future restlessness of the sheeple.

Wed, 05/01/2013 - 10:46 | 3517800 John Law Lives
John Law Lives's picture

"looks like they forgot to add small ball bearings and propane tanks to the list, which at some point in time will be essential to the future restlessness of the sheeple."  -  H E D G E H O G


"It's all ball bearings nowadays!"

Wed, 05/01/2013 - 10:35 | 3517749 SheepDog-One
SheepDog-One's picture

JUST what the doctors ordered to get stawks back in their regular normal direction...up...WAY UP!

Wed, 05/01/2013 - 10:32 | 3517752 Quinvarius
Quinvarius's picture

The fact that we wait for government data or soundbytes to tell us anything is a pretty clear indication that the nation's focus is not on recovering anything in the free markets.

Wed, 05/01/2013 - 10:33 | 3517754 Iam Yue2
Iam Yue2's picture

The New Abnormal.  

Wed, 05/01/2013 - 10:33 | 3517755 Alex Kintner
Alex Kintner's picture

The Sequester is working!! Soon that pesky middle class will be gone. And the Plutocrats can concentrate on financially enslaving what remains. All According To Plan and right on schedule.

Wed, 05/01/2013 - 10:42 | 3517786 uno
uno's picture

agree that is the plan, but not on schedule.  That is why they want the immigration bill passed, hand out flyers in Spanish in Mexico telling them to get food stamps with no repercussions.  What is left of the thinkers are gaining traction.

The problem for the PTB is the military and police waking up to supporting a bunch of evil parasites who will discard them and their families after using them.

Wed, 05/01/2013 - 10:57 | 3517856 The Gooch
The Gooch's picture

As demonstrated in BOSTON. /Heavy fucking sarc.

Wed, 05/01/2013 - 10:35 | 3517766 the not so migh...
the not so mighty maximiza's picture

for cooked numbers it sorta sucks.

Wed, 05/01/2013 - 10:39 | 3517768 PAWNMAN
PAWNMAN's picture

Haven't you guys been watching the news? Things suck because of the sequester! That 2% spending reduction is killing us! This is not Comrade Obamas fault!

Wed, 05/01/2013 - 10:41 | 3517773 SheepDog-One
SheepDog-One's picture

Things suck? Can't be....stawks pegged to all-time record highs, and that's what really matters and the ONLY thing that matters, at all.

Wed, 05/01/2013 - 10:36 | 3517769 SheepDog-One
SheepDog-One's picture

Well...already I can't handle any more of this today...time to get a couple drinks. "Couple Drinks" - Trailer Park Boys - YouTube

Wed, 05/01/2013 - 10:51 | 3517818 Alex Kintner
Alex Kintner's picture

Tipped for Trailer Park Boys vid. But please you are gonna start attracting White Trash.

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