ISM Manufacturing Supports All-Time Highs on S&P 500, Maybe DJIA Too

The big takeaway here is that weather may not have been what we all hoped in the prior months. Economic activity grew for the tenth month in a row in the manufacturing sector. The overall economy grew for the 58th consecutive month.

March’s 53.7% reading was an increase of 0.5 percentage point from February’s reading of 53.2%. It also was a tad light compared to the consensus estimates. Bloomberg was calling for 54.0% and Dow Jones was calling for 53.9%.

Below are the subcomponents:

• The New Orders Index was 55.1%, a gain of 0.6 percentage point from February’s reading of 54.5%.
• The Production Index was 55.9%, a full 7.7 percentage points higher compared to February’s reading of 48.2%.
• Employment grew for the ninth consecutive month, but at a slower rate by 1.2 percentage points, registering 51.1% compared to February’s reading of 52.3%.
• Of the 18 manufacturing industries, 14 reported growth in March.
• The four industries that reported contraction in March were Apparel, Leather & Allied Products; Wood Products; Electrical Equipment, Appliances & Components; and Miscellaneous Manufacturing.

Tuesday’s reading is not off estimates enough to move the markets much in either direction. That being said, the S&P 500 is still at a new all-time high (1,884) and the Dow Jones industrial Average is only about 30 points off a new all-time high (16,588.20).