ISM Manufacturing Tumbles To One-Year Lows As New Orders Crater; Construction Spending Disappoints

Amid a plunge in new orders to Jan 2014 lows, the ISM Manufacturing index slid to 53.5 (missing expectations of 54.5) to its lowest since Jan 2014 - confirming Markit's US PMI. New export orders contracted. employment growth slumped to 7 month lows, and inventories surged. In addition, after December's tumble in construction spending, January's bounce was only half as much as expedcted (+0.4% MoM vs +0.7% expected) missing for the 6th month in the last 7.

ISM Manufacturing hits one-year low.

As we had warned previously on several occasions, looking at the seasonally adjusted ISM is wrong. Here's why: finally the Adjusted data has caught up with unadjusted.

And worst of all, the number of respondents seeing "Better" New orders plunged to the lowest since 2012:

Here is what cherrypicked responses the ISM selected for the January release:

• "Strong customer demand for our products continues to grow." (Food, Beverage & Tobacco Products)
• "Customers are presenting many new opportunities." (Fabricated Metal Products)
• "Consumer demand remains strong for automotive. Seeking alternatives to maximize production with existing production capacity." (Transportation Equipment)
• "Chinese New Year, West Coast port dock slowdowns, coupled with railroad embargo are all creating logistical challenges and increased backlog of orders." (Wood Products)
• "Sales have stayed very strong even with the dip in oil prices." (Computer & Electronic Products)
• "Dock problems in California continue to delay shipment out of the West Coast. Most material prices are the same except resin prices are down." (Chemical Products)
• "Business conditions are good, stable to improving." (Miscellaneous Manufacturing)
• "West Coast port slowdown is getting serious. Mill has 40+ days of production at the ports and various warehouses." (Paper Products)
• "Agriculture equipment production remains weaker than previous year as farm commodity prices remain low." (Machinery)
• "Business in 2015 has started off on a fast pace. Very busy." (Primary Metals)

And elsewhere, the housing dead cat bounce is over confirmation came when construction spending missed for the 6th of last 7 months, and printed at just 0.4%, on expectations of a 0.7% jump.

Comments

[i_call_you_my_base]

Not to worry, the US will redecouple.

[blown income]

Bullshit...all I see are green shoots..the tv said so

[replaceme]

cheap gas and free college, this must be some kind of outlier. 

[blown income]

I need a fucking job.. oh i'm sorry your over qualified...for everything..fuck

[Unix]

Tell me about it, I could not find a job, so I started my own business.  It is very slow right now, and my war chest is depleted, so it seems only a short matter of time before my family is on the street. It eats at me every day, what to do?

[Osmium]

BTFD?

[Unix]

If I even had the money, it would not go in a dip, not this market right here and now. Although one could say there has been money to be made, all you'd have to do is ride the waves, exit in time and look for the next one.

too much of a casino for my liking, where the house wins, you lose. stack some shiney and some dull, is also a good move, providing one does not have a boating accident?

i am risk off 

[Badself]

Hey guys is it time to buy this dip?

[firstdivision]

Great news according to $CU

[youngman]

Obamas budget is all about spending more...because if you spend money you can make a lot of friends...the FSA loves you is you give them more...pretty amazing

[Philo Beddoe]

That 10 year and 30 year changed course is a damn hurry this morning. Even a fucking Economist could have seen that coming. Well, maybe. 

[jason2]

ready, set, go, ....algos to begin buying the bad news (really good news) my dollar is that the bottom is in for the day...wash, rinse, repeat

[Bill of Rights]

More proof that QE was a scam on the public...And the MSM played along providing the much needed propaganda. I cant wait till people start defaulting on those new Auto loans...lets see eat or continue to pay for a depreciating asset the next 7 years? hmm decisions decisions...

[Element]

Market Action Suggests Abrupt Slowing in Global Economic Activity

John P. Hussman, Ph.D.

February 2, 2015

The combination of widening credit spreads, deteriorating market internals, plunging commodity prices, and collapsing yields on Treasury debt continues to be most consistent with an abrupt slowing in global economic activity. Generally speaking, joint market action like this provides the earliest signal of potential economic strains, followed by the new orders and production components of regional purchasing managers indices and Fed surveys, followed by real sales, followed by real production, followed by real income, followed by new claims for unemployment, and confirmed much later by payroll employment. Stronger conclusions, particularly about the U.S. economy, will require more evidence, but from a global perspective, these pressures are already quite evident.

/.../

So what we’ve really got is a situation where interest rates are low because safer borrowers are swimming in debt, while credit spreads are widening because junkier borrowers are hugely sensitive to even a moderate slowing in global economic activity.

[john milton]

http://fortruss.blogspot.fi/2015/02/russian-trade-with-us-grew-7-despite... ...great sanctions.. stealing marketshare from eu countries

[WTFRLY]

9/11 Truth: The NIST “no molten metal” guy posing by steel with unexplained melting (PHOTOS)

[Unix]

Things are slowing down, just look at the Baltic Dry Index for an indication, what I want to know is how long can this boat stay afloat?

[nakki]

Over/Under in days until Bullard says there is no way the FED can raise rates?

Over 7

Under 7

[drivenZ]

lowest in a year. So this time last year this data point obviously wasnt a trend. Why would it be this year? anybody's guess really. And a score above 50 still means there is expansion. 

[Mike Honcho]

"Generalized, positive statement" (Businesses reliant on consumer spending)

[Unix]

What consumer spending? Unless it is for necessity, I don't buy much! I think the consumer is a bit tapped out, if not under water and just don't know it.  

I have a good education, but am mid-50's, and I am getting close to the end of my rope, but have tried my best to live with my means. It all got away from me after a layoff.  I have remade myself a few times over, trying several different careers, so I am trying business ownership, even that is slow at the moment.

Hell, I am the canary in the coal mine, it seems! When you hear my last chirp, you'll know the jig is up! /s