US Manufacturing Grows on Strong Demand
$DIA, $SPY, $QQQ, $RUTX, $VXX
- The data moved the market due North
Tuesday’s trading session will end early (1:00p EDT), and markets will be closed on Wednesday for the 4th of July Holiday in the US.
A measure of US manufacturing activity surged in June likely as steel and aluminum tariffs caused disruptions to the supply chains, resulting in factories taking longer to deliver goods.
The Institute for Supply Management (ISM) said on Monday its index of national factory activity jumped to a reading of 60.2 last month from 58.7 in May. A reading above 50 in the ISM index indicates an expansion in manufacturing, which accounts for about 12% of the US economy.
“Demand remains robust, but the nation’s employment resources and supply chains continue to struggle,” said the Chairman of the ISM Manufacturing Business Survey Committee.
“Respondents are overwhelmingly concerned about how tariff- related activity is and will continue to affect their business.”
The United States is engaged trade tariff negotiations with its trade partners: China, Canada, Mexico and the EU.
Some analysts fear the tariffs could disrupt supply chains, undercut business investment and potentially wipe out the fiscal stimulus from a $1.5-T tax cut package.
President Donald Trump claims that the United States is being taken advantage of by its trade partners.
The ISM’s supplier deliveries sub-index soared 6.2 points to 68.2 last month. A lengthening in suppliers’ delivery time is normally associated with increased activity, which is a positive contribution to the ISM index.
Economists polled by Reuters had forecast construction spending gaining 0.5% in May. Construction spending accelerated 4.5% on a Y-Y basis.
Monday, the major US stock market indexes came in at: DJIA +35.77 at 24307.18, NAS Comp +57.38 at 7567.71, S&P 500 +8.34 at 2726.45
Volume: Trade on the NYSE came in at 756-M/shares exchanged
- NAS Comp +9.6% YTD
- Russell 2000 +7.8% YTD
- S&P 500 +2.0% YTD
- DJIA -1.7% YTD
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Have a terrific 4th of July Freedom Week