By Mark Pender
NEW YORK (MNI) – MNI’s U.S. capital goods indicator fell eight
tenths in the Aug. 17 period to 46.0, further below 50 to a level that
indicates moderate year-on-year contraction in business activity,
according to the results of MNI’s weekly survey released Monday.
Sales are +1.1% year-on-year with income at +4%. The foreign
exchange effect on sales, at -4%, is the most severe in three years. The
period’s sample size is 515 companies.
Guidance from MNI’s sample points to modest sequential slowing for
third-quarter sales growth. The sequential comparison is +1.1% which was
the rate of shipment growth for second-quarter nondefense capital goods
(to be revised with Friday’s durable goods report).
The sample’s central topic is weakness in Europe including its
contagion effect on other export markets. Many in the sample, struggling
with weakness in new orders, are focusing on backlogs to make
third-quarter guidance.
Guidance points to extending contraction for electronics machinery
and communications equipment with aerospace and commercial construction
adding modestly to growth.
Editor’s Note: MNI compiles its capital goods indicator based on a
weekly sample of company news and data.
** MNI New York Bureau: 212-669-6430 **
[TOPICS: MDUCG$,MT$$$$,M$U$$$,M$UEQ$,MAUDS$]
