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ISM Manufacturing Tumbles To 13-Month Lows, Employment Slumps, Construction Spending Plunges

Tyler Durden's picture




 

Despite a collapse in US macro data in February, Markit somehow managed to conjure a better than expected 55.1 print for US Manufacturing PMI. Under the covers employment creation was the slowest since July and inflationary pressures loom as selling prices rose notably. ISM Manufacturing printed 52.9 - a small miss vs 53.0 expectations - down for the 4th month in a row to 13-month lows, with employment at its weakest since June 2013. Construction spending's modest rebound in (seemingly un-weather-affected) December (after dropping in November) has been destroyed with a 1.1% drop in January (against expectations of 0.3% rise) for the biggest drop in 8 months.

Spot The Odd One Out - one of these is a soft survey... the other summarizes US macro hard data into one variable...

 

Doesn't exactly look like a 'recovery' in manufacturing based on the jobs created...

 

ISM Manufacturing fell and missed for 4th month in a row - but only modestly...

 

Here is the breakdown of New Orders seasonal adjusted vs unadjusted.

Respondents in ISM

  • "West Coast port issue has been a problem for exporting." (Food, Beverage & Tobacco Products)
  • "Business is steady to slightly up." (Fabricated Metal Products)
  • "The major concern for us across the board is the ongoing situation with the West Coast ports. Air freight and overtime have been required to cover for products waiting to be offloaded at the ports." (Transportation Equipment)
  • "Lower oil and natural gas prices continue to put pressure on our revenues. We continue to pursue capital budget cuts and rate reduction efforts with our suppliers." (Petroleum & Coal Products)
  • "The dock delay on the West Coast is seriously impacting the supply chain logistics." (Computer & Electronic Products)
  • "Kind of a mixed bag right now. Some product demand up, some down, basically flat." (Chemical Products)
  • "West Coast port congestion and work slowdowns by the union is hurting our imports and exports, getting worse by the week." (Miscellaneous Manufacturing)
  • "Customer behavior is being negatively impacted by ongoing resin price decreases. Order placement is being delayed to receive lower finished good pricing." (Plastics & Rubber Products)
  • "Business in general is staying its course. Concerns abound over strike possibilities by West Coast longshoremen." (Machinery)
  • "Improving and 2015 off to a good start." (Furniture & Related Products)

Given the historical relationship between earnings expectations and ISM, we leave it to @Not_Jim_Cramer to express his opinion: "If ISM does not print quite a bit lower this month - it's rigged"

You decide.

*  *  *

And finally, construction spending was a disaster - falling 1.1% against expectations of a 0.3% rise...

 

Prepare for the GDP downgrades...

Charts: Bloomberg, @Not_Jim_Cramer

 

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Mon, 03/02/2015 - 11:10 | 5845460 SickDollar
SickDollar's picture

the elite are running out of time and tricks

Mon, 03/02/2015 - 11:14 | 5845477 Nafets93
Nafets93's picture

Let's hope so. Sadly, the "last" option is war.

Mon, 03/02/2015 - 13:56 | 5846100 Fukushima Fricassee
Fukushima Fricassee's picture

God I hope so, I look at this manipulation and get physically sick.

Mon, 03/02/2015 - 11:12 | 5845468 madbraz
madbraz's picture

of course it is rigged.  so what, they don't give a damn.  it's not like there are policemen looking and bad guys go to jail - it is all good for the mafiosi stock market men.

Mon, 03/02/2015 - 11:12 | 5845470 Smegley Wanxalot
Smegley Wanxalot's picture

Sooooooo ... up 2% this week, yes?

Mon, 03/02/2015 - 11:13 | 5845471 giovanni_f
giovanni_f's picture

For a couple of weeks now almost all numbers are just fubar. Yet, GDP and NFP are continuing their winning streaks. Makes sense.

Mon, 03/02/2015 - 11:13 | 5845472 Thisisbullishright
Thisisbullishright's picture

But the markets are up so everything is A OK!

Total bullshit!!

Mon, 03/02/2015 - 11:13 | 5845474 Neue Regel
Neue Regel's picture

So I woke up to check the economic numbers and the markets. Economic numbers down, markets up. Everything seems to be in order.

Mon, 03/02/2015 - 11:15 | 5845479 youngman
youngman's picture

Yes the goal this week is Nasdaq to 5000.....nothing is going to stop it...

Mon, 03/02/2015 - 11:26 | 5845503 Neue Regel
Neue Regel's picture

Looks like its the goal for the day. Not the week. Actually strike that...looks like the goal for the first hour of trading. 

Mon, 03/02/2015 - 11:26 | 5845504 Osmium
Osmium's picture

I would imagine there are tons of stops to take out at 5k.

Mon, 03/02/2015 - 11:15 | 5845480 orangegeek
orangegeek's picture

#FUCKYOUYELLEN

Mon, 03/02/2015 - 11:19 | 5845489 thismarketisrigged
thismarketisrigged's picture

all fridays losses wiped out in less than 5 minutes after open.

 

NOT RIGGED AT ALL!!!

Mon, 03/02/2015 - 11:27 | 5845506 Thisisbullishright
Thisisbullishright's picture

2 points from nasdaq 5000!  final thrusters.....engaged.

 

Mon, 03/02/2015 - 11:45 | 5845580 nakki
nakki's picture

Manufacturing represents 9% of GDP.  Health Care is almost twice that and growing. That's all you need to know about our economy. 

Mon, 03/02/2015 - 12:55 | 5845882 fremannx
fremannx's picture
  • "The major concern for us across the board is the ongoing situation with theWest Coast ports.Air freight and overtime have been required to cover for products waiting to be offloaded at the ports." (Transportation Equipment)
  • "Lower oil and natural gas prices continue to put pressure on our revenues. We continue to pursue capital budget cuts and rate reduction efforts with our suppliers." (Petroleum & Coal Products)

It's not just the West Coast ports. The CEO of the Dutch seaborne freight shipper, Maersk Line, warned that global trade is slowing with no sign of recovery in sight. While declining oil prices are helpful to the company's transportation costs, other deflationary pressures are affecting global growth. A decline in global trade means there is a decline in global GDP. Deflation is strengthening its grip on the global economy.

 

 http://www.globaldeflationnews.com/deflationary-forces-creating-global-s...

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