The Institute for Supply Management (ISM) has reported that manufacturing is suddenly booming in America. Its July Manufacturing Index rose handily to 55.4 from only 50.9 in June. Dow Jones was looking for an improvement only to 52.0, and Bloomberg was calling for 53.1.
Today’s report is summarized as seeing growth in New Orders, as well as growth in Production and Employment. Unfortunately, the ISM signaled that the inventories are contracting as supplier deliveries were also slowing. That being said, this marked the 50th consecutive month of growth.
The S&P 500 is up more than 18 points now, and the DJIA is up 148 points. What matters the most is that the S&P 500 is now at 1,704 for an all-time high, and the DJIA just hit another all-time high of 15,649.
Here is a breakdown of some of the details:
- PMI registered 55.4%, an increase of 4.5 percentage points from June’s 50.9%, the highest of the year and indicating expansion in the manufacturing sector for the second month in a row.
- The New Orders Index increased in July by 6.4 percentage points to 58.3%.
- The Production Index increased by 11.6 percentage points to 65%.
- The Employment Index registered 54.4%, an increase of 5.7 percentage points from June.
- The Prices Index fell 3.5 percentage points to 49%, indicating that overall raw materials prices decreased from last month.
- Comments from the panel generally indicate stable demand and slowly improving business conditions.
- Of the 18 manufacturing industries covered, 13 reported growth.