By Mark Pender
NEW YORK (MNI) – MNI’s U.S. capital goods indicator rose 2.7 points
in the April 20 period to 47.5, below 50 for a sixth straight period to
indicate contraction in year-on-year business activity, according to the
results of MNI’s weekly survey released Monday.
Sales are a year-on-year +2.5% with currency effects shaving one
off one percentage point. Income is a year-on-year -12%. Sample size in
the period is 243 companies.
MNI’s sample is pointing to no more than a slight sequential gain
for first-quarter shipments of nondefense capital goods which posted
very thin fourth-quarter growth of +0.3%.
Hubbell (HUBB), which makes electrical equipment, is posting
mid-single digit growth and sees no better for the full year: “Our view
has not changed for non-residential construction; new spending is
expected to be weak with strong renovation and relight activity
providing an offset.”
In contrast, Insteel Industries (IIIN), which makes
wire-reinforcing products, believes its construction markets have now
bottomed and it reports some initial signs of improvement. The company
is adding new equipment to broaden its product offerings for next year.
Specialty chemicals maker Cytec (CYT) believes the outlook for the
global aerospace market is very positive due to higher build rates for
large commercial programs and steady demand growth in the business jet
and rotorcraft sectors.
References to restructurings tied to Europe are increasingly
popping up including from pump maker Gardner Denver (GDI) which is now
taking “the necessary steps” to align its cost structure to meet the
challenges in Europe.
Editor’s Note: MNI compiles its capital goods index based on a
weekly sample of company news and data.
** MNI New York Bureau: 212-669-6430 **
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