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ISM Manufacturing Surges To 3 Year Highs; Ignores PMI, Construction Spending Plunge

Tyler Durden's picture




 

US manufacturing both declined (PMI) and rose (ISM) in October as the divergence  between the two soft-survey-based data streams is as ridiculous as it was in the second half of last year. ISM printed a cycle high 59.0 (highest since March 2011) smashing the 56.1 expectations (the biggest beat since July 2013). While the headline print was exuberant, New orders fell, as did new export orders. Construction spending fell for the 2nd month in a row, dropping 0.4% against expectations of a 0.7% rise.

 

Doesn't seem like the US decoupling is taking hold domestically... 4th miss in a row for Construction spending and 2nd monthly drop.

  • *CONSTRUCTION SPENDING IN U.S. DECLINES TO WEAKEST SINCE MARCH
  • *U.S. SEPT. PUBLIC CONSTRUCTION SPENDING FALLS 1.3% FROM AUGUST
  • *U.S. SEPT. PRIVATE NON-RESIDENTIAL CONSTRUCTION FALLS 0.6%


ISM beat by the most since July 2013 to cycle highs...

 

Makes sense...

 

It appears the ISM needs a better seasonal adjustment.

And speaking of seaosnal adjustments, because a "soft-data" survey apparently needs to be seasonally adjusted, here is what the all importnat New Orders ISM would look like with and without seasonal adjustments:

 

Yup: the unadjusted New Orders print is back at February 2014 levels.

Clearly what US manufacturing needs is yet another, a third, "impartial" survey of US manufacturing to serve as a tiebreaker to farcical states, such as now, when Markit says worse, ISM says better, and the "self-reported", cherrypicked, seasonally-adjusted respondents say the following:

  • "Holiday orders are exceeding seasonal forecasts. Customers are demanding additional quantities above prior orders. Fuel costs and other positive signals appear to be creating demand above normal." (Food, Beverage & Tobacco Products)
  • "Weakness in commodity prices very positive on our business." (Fabricated Metal Products)
  • "We continue to see strong demand across multiple sectors." (Transportation Equipment)
  • "Business steady and strong." (Furniture & Related Products)
  • "Another strong month in terms of business growth." (Computer & Electronic Products)
  • "Most business segments are seeing an upward trend in orders — mostly from existing customers, but also some new customers. Transportation continues to be a major issue." (Chemical Products)
  • "Conditions are still basically flat." (Printing & Related Support Activities)
  • "Production is oversupplying demand, and prices have softened." (Wood Products)
  • "Outer body material changes in the auto industry means new equipment and manufacturing growth." (Machinery)
  • "Business conditions are good; sales and production volumes are generally increasing." (Miscellaneous Manufacturing)
 

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Mon, 11/03/2014 - 11:16 | 5406681 Temporalist
Temporalist's picture

That divergence is what is called "The Gap of Hopium"

Mon, 11/03/2014 - 11:35 | 5406757 DeadFred
DeadFred's picture

The monday before elections, who could have guessed?

Mon, 11/03/2014 - 13:27 | 5407181 KnuckleDragger-X
KnuckleDragger-X's picture

Can't wait to see the Wed. stock market....

Mon, 11/03/2014 - 11:20 | 5406688 SheepDog-One
SheepDog-One's picture

#1 component of ISM must be the manufacturing of bullshit because certainly THAT'S never been higher!

Mon, 11/03/2014 - 11:31 | 5406747 The Merovingian
The Merovingian's picture

"There are three kinds of lies: lies, damned lies, and statistics."  

Mark Twain

Mon, 11/03/2014 - 11:21 | 5406699 Winston Churchill
Winston Churchill's picture

See, bullshit can go uphill after all.

Mon, 11/03/2014 - 11:21 | 5406702 Bell's 2 hearted
Bell's 2 hearted's picture

July and august revised down.

 

will be a downward revision to Q3 GDP

Mon, 11/03/2014 - 11:22 | 5406705 Colonel Klink
Colonel Klink's picture

More manipulated BULLSHIT where the information doesn't agree because it's so hard to keep track of your lies once you've been LYING for SIX fucking years.

Mon, 11/03/2014 - 11:23 | 5406709 wmbz
wmbz's picture

Thank heaven that the holiday shopping season is upon us.

The savvy USSA consumer will be out in droves snapping up all the must have bargins.  They'll just whip out their capital one credit card and melt the numbers off the bitch!

Merry Christmas!

What's in your wallet!

Mon, 11/03/2014 - 11:26 | 5406718 Bell's 2 hearted
Bell's 2 hearted's picture

The laughable part will be if a Bull points out UPWARD revision to august (-0.8% to -0.5%)

 

BUT ... guess what?

 

August revised down ... but July revised down EVEN FURTHER ... making  august "better" ... in an orwellian way

Mon, 11/03/2014 - 11:34 | 5406759 Spastica Rex
Spastica Rex's picture

Dreams, they're what's important, not the dreary details of our ordinary lives. See, I've been trying to fly for a long time.

Mon, 11/03/2014 - 11:39 | 5406773 FieldingMellish
FieldingMellish's picture

Just need to hold it together for 36 more hours...

Mon, 11/03/2014 - 11:46 | 5406799 El Hosel
El Hosel's picture

They must have added money printing to the maufactoring index.

Mon, 11/03/2014 - 11:50 | 5406805 El Hosel
El Hosel's picture

Gasoline and oil make a low next couple daze? Lets have an 10 year chart with gasoline price and election dates.

Mon, 11/03/2014 - 11:53 | 5406832 Puncher75
Puncher75's picture

Government seems to be taking a play out of the Clinton handbook.  Admit nothing, deny EVERYTHING, and make WILD counter-accusations!

Mon, 11/03/2014 - 13:30 | 5407189 KnuckleDragger-X
KnuckleDragger-X's picture

Well, if it worked, once it'll work again...

Mon, 11/03/2014 - 12:14 | 5406902 ejmoosa
ejmoosa's picture

I bet there are all sorts of wilde and conflicting readings in a cockpit-right before impact.

Mon, 11/03/2014 - 12:23 | 5406941 razorthin
razorthin's picture

Don't they mean the ISM Manufactured Index?

Mon, 11/03/2014 - 12:37 | 5406994 zaphod42
zaphod42's picture

FT is having a good time with it:http://www.ft.com/fastft/230162/us-manufacturing-growth-cools-october

USA BAU USA BAU USA BAU

Dang!

 

Craig

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