While you were sleeping: US manufacturing delivers
April 2 (BusinessDesk) – Equities advanced, pushing the Standard & Poor’s 500 Index to a record high, as the latest manufacturing data showed that the US economic recovery remained on
track.
The Institute for Supply Management’s index increased to 53.7 in March from 53.2 a month earlier, a sign that the
effects of the harsher-than-usual American winter are beginning to wear off. Of the 18 manufacturing industries, 14
reported growth in March, according to the report.
"There's a whiff of spring in the economic data, which means we're starting the second quarter with signs that the
economy is maintaining the kind of reasonable growth that will continue to support the market," Jim McDonald, chief
investment strategist at Chicago-based Northern Trust Global Investments, told Reuters.
Separately, Markit’s US manufacturing PMI fell to 55.5 in March, down from 57.1 in February.
“The fall in the composite Manufacturing PMI masks the ongoing resilience of output, new orders and employment growth,
all of which continued to rise at historically strong rates in March,” Chris Williamson, chief economist at Markit, said
in a statement. “That’s because the PMI also includes a measure of supplier delivery times, which dragged the PMI down
but only because deliveries were quicker as a result of improved weather.”
“The survey indicates that factory output growth has picked up again after the weather-related disruptions seen at the
start of the year, presenting policymakers with an encouraging picture of a healthy goods-producing sector that is
generating jobs at the rate of 15-20,000 per month,” Williamson said.
In afternoon trading in New York, the Dow Jones Industrial Average rose 0.29 percent, the Standard & Poor’s 500 Index gained 0.33 percent, while the Nasdaq Composite Index climbed 0.99 percent. Earlier in the session,
the S 500 rose as high as a record 1,884.60.
Gains shares of Cisco and Boeing, last up 2.1 percent and 1.6 percent respectively, propelled the Dow higher.
In Europe, the Stoxx 600 Index ended the day with a 0.6 percent advance from the previous close. Germany’s DAX increased
0.5 percent, while both the UK’s FTSE 100 and France’s CAC 40 added 0.8 percent.
Markit’s euro-zone manufacturing PMI slipped to 53.0 in March from 53.2 February, unchanged from the initial estimate.
“Despite having cooled slightly in March, the euro area manufacturing sector continues to enjoy its best spell of growth
since early-2011,” Williamson said in a statement. “The goods-producing sector is on course to provide a meaningful
boost to the overall economy in the first three months of the year.”
Separate data showed the unemployment rate in the euro zone held at 11.9 percent in February, unchanged after a revision
for the previous month.
China’s PMI as measured by HSBC and Markit Economics slid to 48 in March, the lowest reading since July, from 48.5 in
February. A separate PMI edged higher to 50.3, up from 50.2 the previous month, according to Chinese government data.
The reports underpinned expectations the government might increase its stimulus efforts to help boost the pace of growth
in the world’s second-largest economy.
(BusinessDesk)