By Mark Pender
NEW YORK (MNI) – MNI’s U.S. capital goods index slowed for a fourth
straight week, down a steep 6.6 points in the Nov. 25 period to 59.7 but
still well above 50 to indicate solid growth in year-on-year business
conditions, according to the results of Market News International’s
weekly survey released Monday.
Guidance from the sample is coming down as companies reassess
customer demand given trouble in Europe. Sample size in the current
period is 357 companies.
Averages are slowing with the 12-week average for the index down
four tenths to 66.6 for its lowest reading since this time last year.
Year-on-year sales are +8.1 for its lowest reading since September
last year. Income is down two percentage points to +7.0%.
Last week’s durable goods report from the government shows a
marginal 0.2% rise for October nondefense capital goods shipments, well
down from third-quarter rates when sequential growth came in at 5.0%
with year-on-year growth at 9.4%. The outlook for November and December
shipments is guarded as new orders have been shrinking and the build in
unfilled orders has been slowing.
The commentary highlight of the week is from DRI Corp. (TBUS) which
makes transportation announcement systems and which sees no better than
flat sales in the year ahead: “We expect projects and orders to be
stalled, delayed, rescheduled, and otherwise modified in fourth quarter
2011 and throughout fiscal year 2012 as served markets and customers
react to unsettling global economic news.”
Editor’s Note: MNI compiles its capital goods index based on a
weekly sample of company news and data.
** Market News International New York Newsroom: 212-669-6430 **
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