The March Manufacturing ISM Report on Business shows that the Purchasing Managers Index (PMI) came in at 53.7%. Growth was reported in New Orders, Employment, Production and Inventories subcomponents. Supplier deliveries slowed in March.

The big takeaway here is that weather may not have been what we all hoped in the prior months. Economic activity grew for the tenth month in a row in the manufacturing sector. The overall economy grew for the 58th consecutive month.

March’s 53.7% reading was an increase of 0.5 percentage point from February’s reading of 53.2%. It also was a tad light compared to the consensus estimates. Bloomberg was calling for 54.0% and Dow Jones was calling for 53.9%.

Below are the subcomponents:

• The New Orders Index was 55.1%, a gain of 0.6 percentage point from February’s reading of 54.5%.
• The Production Index was 55.9%, a full 7.7 percentage points higher compared to February’s reading of 48.2%.
• Employment grew for the ninth consecutive month, but at a slower rate by 1.2 percentage points, registering 51.1% compared to February’s reading of 52.3%.
• Of the 18 manufacturing industries, 14 reported growth in March.
• The four industries that reported contraction in March were Apparel, Leather & Allied Products; Wood Products; Electrical Equipment, Appliances & Components; and Miscellaneous Manufacturing.

Tuesday’s reading is not off estimates enough to move the markets much in either direction. That being said, the S&P 500 is still at a new all-time high (1,884) and the Dow Jones industrial Average is only about 30 points off a new all-time high (16,588.20).

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