source : zerohedge
Say hello to the lowers ISM number in two years!
After a brief rally in overnight trading, the dropped, wiping out that fabricated debt ceiling drama of a rally. The ISM number is bad, really bad. Every single subindex was weaker except for imports and exports. No doubt the buy side analysts will be working overtime today trying to spin some story about how positive this is, or how temporary this soft spot will be.
Some great comments from a Reuters piece:
GENE MCGILLIAN, ANALYST, TRADITION ENERGY, CONNECTICUT
“The oil market is really flailing around this morning and the initial euphoria of the debt deal seems to be waning. There’s still plenty of uncertainty surrounding the debt deal ahead of Congressional votes, and a disappointing ISM number has now taken some of the bidding out of the market.”
KEITH HEMBRE, CHIEF ECONOMIST, NUVEEN ASSET MANAGEMENT, MINNEAPOLIS
“It’s a pretty good miss on the downside. My trend analysis suggests that we are going to see another move to the downside to high 40s. These are the types of numbers that are consistent with what we saw with the GDP numbers. Absent a governmental shock, we would dredge forward with this stagnant economic performance. We’ll be mired in this 1 to 2 percent (growth) environment we have been in.”
SEAN INCREMONA, ECONOMIST, 4CAST LTD, NEW YORK
“It is pretty terrible, very disappointing. That really just nails home the snail’s-pace GDP number that we got on Friday. This shows that there is some underlying softness that is really coming through. New orders dropping below 50 doesn’t suggest that there is going to be much momentum going forward either.”
JOE SALUZZI, CO-MANAGER OF TRADING AT THEMIS TRADING IN CHATHAM, NEW JERSEY
“The drop of the last 50 points or so was certainly the ISM numbers. It’s a really bad one, and this is closely related to the GDP forecast. Before that (ISM data), it was a bit of sell on the news.
“When you get a reversal like this, it’s certainly not a good thing. We were getting some bad news but starting July, things started pointing to growth. And then we get a number like this. We will see growth revisions, and that tops any news that comes of Washington.”
TOM PORCELLI, U.S. ECONOMIST, RBC CAPITAL MARKETS, NEW YORK
“I think what makes this report — what gives it sort of nasty undertones, is this new orders index slipping below 50. For an economy that’s struggling here, this just adds credence to that notion.
“ISM is a sentiment indicator; it’s not based on real activity. From that perspective you could maybe make an argument that a lot of the uncertainty that has been put forward by the debt debate may have found its way in there. That may be a bit of a stretch but I wouldn’t dismiss it outright.”
