By Mark Pender
NEW YORK (MNI) – MNI’s U.S. capital goods index firmed 1.4 points
in the June 4 period to 60.4, a cycle best and an indication significant
and accelerating expansion is underway in the industrial sector,
according to Market News International’s weekly survey released Monday
Sales are at a year-on-year +9.9% with the four-week average, up
six-tenths at +9.1%, continuing to build out a steep ascending slope.
Depth of distribution is improving quickly with 58% of the sample
posting significant gains in sales, up from a 44% share this time last
month.
Income for the period’s 116-company sample is a cycle best +45%.
Companies are not commenting much on volatility in the financial
markets but they are commenting more and more on the rise underway in
the dollar and on uncertainty over their European markets.
Company guidance is looking for a slightly negative year-on-year
currency effect for export sales during the second quarter, a factor
that may begin to slow the sample’s total sales growth. Currency added
3.0% to export sales in the prior two quarters.
But the comment most repeated is the comment most sought, that is
building momentum for new orders. The sample’s electronics markets in
Asia is a center of strength with reports of improving demand from
residential-construction and aerospace two keys on the domestic side.
International trade data on Thursday may show weakness for capital
goods exports in April given that month’s month-to-month dip in total
shipments. But any export dip is likely to be reversed in May given the
building momentum underway for orders.
On the company side, watch for comments this week from lift parts
maker Cascade (CASC), non-residential products maker NCI Building System
(NCS), and industrial filter maker Pall (PLL).
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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