The PMI registered 50.8%, a decrease of 0.8 percentage point from September's reading of 51.6%, indicating expansion in the manufacturing sector for the 27th consecutive month. A reading above 50% indicates that the manufacturing economy is generally expanding; below 50% indicates that it is generally contracting.
Of the 18 manufacturing industries, eight are reporting growth in October, in the following order: computer and electronic products; petroleum and coal products; food, beverage and tobacco products; nonmetallic mineral products; primary metals; fabricated metal products; paper products; and machinery. The six industries reporting contraction in October (listed in order) are: plastics and rubber products; chemical products; apparel, leather, and allied products; printing and related support activities; electrical equipment, appliances and components; and miscellaneous manufacturing.
The New Orders Index increased 2.8 percentage points from September to 52.4%, indicating a return to growth after three months of contraction. The Prices Index, at 41%, dropped 15 percentage points, and is below the 50% mark for the first time since May 2009 when it registered 43.5%. Inventories decreased to 46.7%, which is 5.3 percentage points below the September reading of 52%. Comments from respondents are mixed, indicating positive relief from raw materials pricing and continuing strength in a few industries, but there is also more concern and caution about growth in this uncertain economy.
The eight industries reporting growth in new orders in October (listed in order) are: petroleum and coal products; nonmetallic mineral products; plastics and rubber products; computer and electronic products; primary metals; electrical equipment, appliances, and components; food, beverage, and tobacco products; and miscellaneous manufacturing. The nine industries reporting decreases in new orders in October (listed in order) are: wood products; textile mills; chemical products; furniture and related products; printing and related support activities; paper products; transportation equipment; machinery; and apparel, leather, and allied products.
ISM's Production Index registered 50.1% in October, which is a decrease of 1.1 percentage points compared with the September reading of 51.2%, and indicates growth for the second consecutive month. An index above 51%, over time, is generally consistent with an increase in the Federal Reserve Board's Industrial Production figures.
The eight industries reporting growth in production during October (listed in order) are: wood products; primary metals; nonmetallic mineral products; food, beverage, and tobacco products; fabricated metal products; paper products; computer and electronic products; and miscellaneous manufacturing. The nine industries reporting a decrease in production in October (listed in order) are: plastics and rubber products; textile mills; furniture and related products; printing and related support activities; electrical equipment, appliances and components; chemical products; transportation equipment; machinery; and apparel, leather, and allied products.
ISM's Employment Index registered 53.5% in October, which is 0.3 percentage point lower than the 53.8% reported in September. This is the 25th consecutive month the Employment Index has been above 50%.
Of the 18 manufacturing industries, eight reported growth in employment in October in the following order: textile mills; primary metals; fabricated metal products; petroleum and coal products; transportation equipment; paper products; machinery; and computer and electronic products. The six industries reporting a decrease in employment in October (listed in order) are: plastics and rubber products; electrical equipment, appliances and components; miscellaneous manufacturing; chemical products; apparel, leather, and allied products; and food, beverage, and tobacco products.
The Inventories Index registered 46.7% in October, 5.3 percentage points lower than the 52% reported in September. The five industries reporting higher inventories in October are: textile mills; furniture and related products; computer and electronic products; food, beverage and tobacco products; and machinery. The 11 industries reporting decreases in inventories in October (listed in order) are: apparel, leather, and allied products; miscellaneous manufacturing; electrical equipment, appliances, and components; primary metals; chemical products; nonmetallic mineral products; printing and related support activities; transportation equipment; fabricated metal products; plastics and rubber products; and paper products.
More information about this report, including expanded data, is available online.
TAPPI
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