G.O.O.D

Source: Bloomberg.com

The decline in U.S. manufacturing deepened in December as demand for such products as cars, appliances and furniture reached the lowest level since at least 1948, signaling further cutbacks in factory jobs and production this year.

The Institute for Supply Management’s factory index fell to 32.4, below economists’ forecasts and the lowest level since 1980, from 36.2 the prior month. Readings less than 50 signal contraction. The group’s new-orders measure reached the lowest level on record and prices slid the most since 1949.

“Every component suggests that the weakness is going to carry over into 2009,” Mark Vitner, a senior economist at Wachovia Corp. in Charlotte, North Carolina, said in a Bloomberg Television interview. “There’s just not a whole lot of new business coming in,” and companies will have a “painful adjustment” as consumers shun spending.

Today’s figures underscore that, with private demand collapsing, manufacturers’ best hope for new business this year may be President-elect Barack Obama’s plans for an unprecedented stimulus package. Obama has pledged an investment program in roads, schools and the U.S. energy network akin to the 1950s- era interstate highway construction boom.

Stocks advanced on the first day of trading in 2009, following the biggest annual drop for the Standard & Poor’s 500 Index in 71 years, on expectations government stimulus efforts will curtail the recession. The S&P index rose 1.4 percent to 916.16 at 11:08 a.m. in New York. Benchmark 10-year Treasury yields rose to 2.25 percent from 2.22 percent late Dec. 31.

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Technorati Tags: Manufacturing

Source: washingtonpost.com

U.S. manufacturing fell sharply in December and reports from abroad showed the same for plants in Europe and Asia, as businesses cut production and slashed product orders in response to the global recession.

The Institute for Supply Management’s index of industrial production slipped by 3.8 percentage points in December compared to the month before, to the lowest level since 1980.

The private group’s survey of purchasing executives provides a rough guide to whether manufacturing companies are expanding output and receiving increased numbers of orders, or seeing their business decline. The index for December stood at 32.4, compared to 36.2 in November. An index above 50 indicates that manufacturing activity is expanding, while a reading below 50 indicates a decline.

It is the fifth consecutive month that the group’s measure of industrial production has stalled, a result consistent with declining consumer demand and economic weakness throughout the United States.

The decline was both deep and broad, the ISM reported: none of the industries covered in the survey reported an expansion in their business, and the drop registered not just in the institute’s index of production, but also in its measures of employment, prices and backlogged orders. The group’s index of new orders and prices were at their lowest levels since the late 1940s.

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Source: The Associated Press

Japan’s contracting economy got a slew of bad news Friday when government figures showed that industrial production plunged by its biggest margin on record in November, the jobless rate jumped and household spending fell.

Output at the nation’s manufacturers tumbled 8.1 percent from October, the largest drop since Tokyo began measuring such data in 1953, as Japan’s automakers and others slashed production to cope with slowing global demand. A government survey predicted further declines of 8 percent in December and 2.1 percent in January.

“Exports and industrial production are falling so extraordinarily quickly that it almost defies analysis,” said Richard Jerram, chief economist at Macquarie Securities in Tokyo.

The drop in factory production is nearly double the previous biggest decline of 4.3 percent in January 2001, according to the Ministry of Economy, Trade and Industry. Earlier this week, trade data showed that exports plunged a record 26.7 percent in November.

Many companies, including big names like Toyota Motor Corp. and Sony Corp., have announced plans to cut production and workers. The yen’s recent surge has also dealt a huge blow to the world’s second-largest economy by eroding exporters’ overseas earnings.

The job cuts are already being reflected in a higher unemployment rate, which rose to 3.9 percent in November from 3.7 percent in October, the Ministry of Internal Affairs said. That’s still below the 4.2 percent reached in August.

The ministry said 2.56 million people were unemployed in Japan in November, an increase of 100,000 from a year earlier.

Part-time and temporary workers have suffered the bulk of job cuts so far. The Ministry of Health, Labor and Welfare said Friday that given current company plans, 85,000 such workers will have lost their jobs between October and March, compared to about 3,300 permanent employees.

The largest portion of such job cuts were in Aichi prefecture of central Japan, where Toyota and many of its part makers are based. Layoffs of salaried employees is rare in Japan, where lifetime employment is a tradition.

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Technorati Tags: manufacturing, Japan

Source: Yahoo! Finance

A gauge of U.S. manufacturing activity that fell to a 26-year low Monday followed similarly weak readings in Europe and China, fueling fears of a deepening global downturn.

The Institute for Supply Management’s index of manufacturing activity for November fell to 36.2 from October’s 38.9. The reading was worse than Wall Street economists’ expectations of 38.4, according to a survey by Thomson Reuters. A figure below 50 indicates the sector is contracting.

The November reading is the lowest since May 1982, the Tempe, Ariz.-based ISM said. The report is based on a survey of corporate purchasing managers.

The report came the same day that the National Bureau of Economic Research, a private group, said the U.S. economy has been in a recession since December 2007.

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Source: MarketWatch

The nation’s manufacturing firms were contracting at a much faster pace than expected in September, one of the clearest signs to date that the economy has entered recession territory, according to a closely watched survey of top executives released Wednesday.

The Institute for Supply Management index fell to 43.5% from 49.9% in August, much lower than the 49.6% expected by economists surveyed by MarketWatch. See Economic Calendar.
This marked the sharpest one-month drop in the index since 1984. The index is now at its lowest level since October 2001. Read full survey.

Prior to September, the ISM has been treading water, hovering around 50. This seen as a signal the economy was muddling along. But now economists said there is little chance that months of negative growth can be avoided.

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Source: NYTimes.com

Wall Street finished mixed in fickle trading Wednesday, with investors unsettled about the economy ahead of Friday’s employment report and only somewhat relieved about sliding commodities prices.

The Commerce Department gave the market just modest comfort when it said orders for manufactured products rose by 1.3 percent in July. The figure was higher than the 0.8 percent predicted by economists polled by Thomson Financial/IFR; the department also upwardly revised its June reading to an increase of 2.1 percent.

However, many traders brushed off the report as old news, given that it is now September. With automakers releasing sluggish August sales and the Federal Reserve reporting weak economic activity throughout the nation, investors proceeded cautiously.

Anxiety about the Labor Department’s August jobs report, due Friday, also prevented many investors from making any major commitments. It also had them largely shrugging off another drop in commodities, although a massive pullback in commodities since earlier in the summer has helped alleviate some of Wall Street’s inflation worries.

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