The Chinese PMI may be slowing down (first HSBC, official one coming out soon), but why bother when according to MarkIt it is now the US' turn to carry the torch of economic growth, reality notwithstanding. As the just released Chicago PMI indicated, in February the broad index rose to 56.8, higher by 1.2 points and beating expectations of a 54.0 print. It is only logical that with the rest of the world in contraction mode, and China about to enter, that the US would have the highest print in 11 months (or Q1 2012, when US GDP was just a tad higher). Or not. Remember: it is all about playing along the script that always, at some place, there is at least some growth taking place. That said, while last month cojoined PMI and Mfg ISM were flipped, as has happened nearly every month in the past year to keep everyone baffled with BS, today's PMI beat likely means that the Manufacturing ISM will be a miss, which according to GETCO's algos will be just as positive for stocks, as today's beat.
[7]
Among the components, New Orders rose to the highest in 11 months rising to 60.2, from 58.2, Inventories dipped (so no GDP restocking then?), Prices Paid rose to 61.8 from 60.7, and Employment declined to 55.7 from 58.0. Only in the last case bad news is good news, just as good news is good news. In fact no news, is great news and any news will send Bernanke's policy tool, the Russell 2000 limit up.
Most entertaining as always were the respondents:
- To start out the year, Jan[uary] was stable and we were one M[illion] above our 2012 numbers for Jan[uary]. Sales orders are up, and Feb[ruary] through the end of March is looking good.
- Order intake is slow for January with a slight increase in February.
- Our orders were down for January. However, by end of January we becam[e] inundated with new orders. It appears that we will be busy throughout first quarter. We will also be hiring new welders to assist with capacity.
- Good uptick in quoting this month; hopefully it will add to our already healthy order backlog.
- Business remains steady but not any better than 2012. We are keeping our fingers crossed that we might see some improvement, but have not seen an[y] firm indications that it will increase.
Source [8]