This morning’s ISM Manufacturing report missed expectations, but the headline reading of 52.4 is still consistent with an expanding economy. New orders dipped from last month, employment declined and prices surged. Bradley J. Holcomb of ISM elaborated on the report:
“The PMI registered 52.4 percent, a decrease of 1.7 percentage points from January’s reading of 54.1 percent, indicating expansion in the manufacturing sector for the 31st consecutive month. The New Orders Index registered 54.9 percent, a decrease of 2.7 percentage points from January’s reading of 57.6 percent, reflecting the 34th consecutive month of growth in new orders. Prices of raw materials increased for the second consecutive month, with the Prices Index registering 61.5 percent. As was the case in January, new orders, production and employment all grew in February — although at somewhat slower rates than in January. Comments from the panel continue to reflect a generally positive outlook for the next few months.”
All in all it’s not a bad report, but it does offer some cautionary signs. The Apple stock market rally appears totally unfazed by the miss in expectations and deterioration in data. The “can’t lose” market is officially back.