–Research Firm Strategas Has No Plan To Issue Non-Mfg SLIM Equivalent

By Yali N’Diaye

WASHINGTON (MNI) – The former head of the widely followed Institute
For Supply Management manufacturing index Friday said it “remains to be
proven” how his new employer’s leading manufacturing index correlates
with the ISM index.

Research firm Strategas announced Friday the creation of the
Strategas’ Leading Indicator of Manufacturing (SLIM), an early monthly
measure of manufacturing activity.

The survey will be conducted by former ISM survey chief Norbert
Ore, whose hiring by Strategas was also announced Friday.

Asked how SLIM and ISM correlate, Ore told Market News
International “That remains to be proven when we have sufficient history
available.”

He added, “New Orders and Supplier Deliveries are leading
indicators and hopefully will show a correlation with ISM, but that is
not necessarily our intent.”

However, in a press release earlier Friday, Strategas Managing
Partner and Chief Investment Strategist Jason Trennert said “Norbert’s
vast experience in conducting such high frequency economic studies will
provide our clients with an advanced look at the market-moving ISM at
the start of the following month.”

Ore told MNI there is no plan “at this time” to expand the SLIM
index to include additional components such as prices.

Strategas said Friday SLIM’s New Orders component was 62.5 in
January, indicating an acceleration in the pace of manufacturing
activity relative to December.

“The Supplier Deliveries Index with a reading of 50 percent was
less optimistic by comparison and signals no change in demand,” Ore said
in the press release.

The survey was conducted late in the January 9 week.

The ISM new orders index was 57.6 in December, up from 56.7 in
November, and supplier delivery was unchanged at 49.9.

Current ISM survey chief Bradley Holcomb said on January 3 that he
sees “the PMI continuing to climb up, gradually, slowly over the next
few months,” but did not specify by component.

ISM will publish its January survey results on February 1st at
10:00 am ET, followed by the non-manufacturing survey on February 3rd.

Asked whether he had any plans to create a non-manufacturing
version of the SLIM, Ore told MNI that “non-manufacturing is more
coincident, and more difficult to gauge early in the month.”

He also told MNI that Strategas intends to release the SLIM index
“on or about the 14th of each month depending on how the weekends and
holidays fall.”

Regional measures of manufacturing activity are released during the
month, but the national report on business only comes the first working
day of the following month.

The ISM Purchasing Managers’ Index is based on the seasonally
adjusted diffusion indexes for five indicators, with a 20% weight for
each of them: New Orders, Production, Employment, Supplier Deliveries,
and Inventories.

The report, however, also includes unadjusted components:
Customers’ Inventories, Prices, Order bakclog, New Export Orders and
import orders.

** Market News International Washington Bureau: 202-371-2121 **

[TOPICS: M$U$$$,MAUDS$]