Friday, April 30, 2010
Interesting comments from Brian Westbury on the Kudlow Report on CNBC regarding the Fed and interest rates. His opinions continue to align close to ours.
The Cumberland purchase makes MEE a lot more appealing as well. That access to 5M more tons of met coal was a huge purchase, but for now it'll be completely ignored while MEE deals with the legal and regulatory issues.
It's also highly possible that several funds are unloading the stock at month end so that it won't appear in the list of investments.
With the Chicago PMI hitting 63.8 today this seems like the ideal stock for a much stronger industrial environment. For now we'll just keep our position in Alpha Natural Resources (ANR) and wait for the best entry point in MEE.
Edit 10:40am: Now we see the news stories about the bribery probe by the FBI. Clearly a few people knew about this prior to the headlines.
Thursday, April 29, 2010
Not sure they've posted all of the 30 leading market indicators included in the study, but its interesting to note that it still flashes an extremely bullish case. Basically the same numbers as back in late 2004 before the market made its run over the next few years from 1,150 to 1,550.
As usual such indicators are always designed with the numbers that would've predicted the past corrections and booms. Sometimes though they aren't that great at predicting the future. Changes in how people invest such as via ETFs or comm odities versus individual stocks can skew numbers. Greater access to options and futures can also skew numbers down the road.
All in all though, these indicators can be very useful for guiding long term investment decisions. Is the market up too much? Leading indicators don't suggest so. In fact, most of them suggest the returns have just started. It always helps to review such indicators when all the headlines are so negative with such things as Goldman Sachs being sued by the SEC and the Soverign Debt crisis. Most people would flee stocks if they don't have a strong base of what really matters. The most important decision the past 2 weeks is that the Fed will keep short term rates at near zero allowing the yield curve to remain extremely bullish. That always trumps the headlines.
For now stay long and if you don't believe me check out the BMSI.
Tuesday, April 27, 2010
Just about every measure saw marked improvements. Volume of new orders soared from 10 to 41 and shipments went from 5 to 30. Encouraging signs to see employment pick up for basically the first time since early 2008 (other then a small bump up in Oct '09).
This measure has a limited history and it is not as widely followed as the Empire, Philly, or Chicago districts but it is an earlier glimpse into the current month. If this is any indication of April in general, the overall numbers will be just off the charts.
- Manufacturing activity in the central Atlantic region expanded for the third straight month, according to the Richmond Fed's latest survey. All broad indicators — shipments, new orders and employment — landed in positive territory, with manufacturers noting their first increase in worker numbers since October 2009. Other indicators were also positive. Backlogs increased for the first time since August 2009 and capacity utilization hit an all-time high reading since the inception of the measure. Vendor lead-time grew at a considerably quicker rate — the highest reading since August 2004, indicating slower delivery times, and inventories increased at a somewhat quicker pace.
- In April the seasonally adjusted composite index of manufacturing activity — our broadest measure of manufacturing — jumped 24 points to 30 from March's reading of 6. Among the index's components, shipments moved up 25 points to 30, new orders leaped 31 points to finish at 41, and the jobs index advanced 13 points to end at 13.
Monday, April 26, 2010
John Markham, Marketwatch columnist, has been bullish for a while and basically encapsulates our thesis. Lots of issues still exist such as the potential increases in capital gains taxes, sovereign debt, and so many other issues. Regardless though, the majority of investors remain rather bearish via pumping money into corporate debt. Almost ironic that after a debt bubble people would be so willing to lend money to debtors.
His points about the SP500 hitting 3,000 are very sound and logical though rejected by just about anybody. After a lost decade in stocks, everybody should be pouring money into equities but instead they are racing into bonds at historically low rates. What is the odds of a 2nd lost decade in stocks? Oddly most people would've been more comfortable investing in stocks in 2000 before the bubble burst then in 2009 when the market hit a decade long bottom. As usual investors chase performance instead of rotating out of hot sectors into the cold ones.
- "It's still the right thing to be long," Markman tells Aaron in the accompanying clip, citing still-low interest rates, strong investor appetite for corporate bonds and stubborn disbelief from the bears. "This is the most morose bull market in history," says the author and Marketwatch columnist.
- S&P 3000. Reflecting on financial history and last round of massive government stimulus in the early 1990s, after which the S&P rose five-fold, Markman says the S&P could hit 3000 by the end of the decade. Recalling "Something along those lines could happen again," he says.
Friday, April 23, 2010
SHLD forecasted earnings with a mid-point of $.15 compared to the $.03 analyst estimate.
- For the quarter-to-date ("QTD") period through April 21, 2010 comparable store sales for our Kmart and Sears stores were as follows:
- Kmart's QTD comparable store sales benefited from increases in apparel, home and toys categories. Sears Domestic's comparable store sales reflect increased sales of home appliances which benefited from the launch of new Kenmore products and a federally funded stimulus program to encourage customers to replace less energy efficient appliance products, offset by lower sales in the tools and home electronics categories.
- We currently expect net income attributable to Holdings' shareholders for the quarter ending May 1, 2010 will be between $0 and $35 million, or between $0.00 and $0.31 per diluted share. In the first quarter of the prior year, we reported net income attributable to Holdings' shareholders of $26 million, or $0.21 per diluted share.
More details from Marketwatch. CS has some valid points about the comps, but the stock price tells a different story.
- Quarter-to-date comparable sales rose 1.7%. At Sears U.S., they rose 0.3%, the first increase since the first quarter of 2004, paced by increased sales of new Kenmore home appliances and a federally funded stimulus program for consumers to buy more energy efficient products.
- At Kmart, sales for the period through April 21 rose 3.2%, driven by demand for apparel, home and toys. That would mark the third straight quarterly gain at the discount chain after 14 straight declines.
- "Buying more of a Canada, a much better-positioned retailer is a plus," said Credit Suisse analyst Gary Balter. "While the headline may show better comps, they should be viewed as disappointing in the context of competitors and even by the company's own standards. With Kmart productivity still so low, it's difficult for the 3% comps to translate into profits. Given Sears' exposure to appliances which we believe has been up double digits and a pick up in some seasonal business, and other broadline names potentially up mid to high single digits, this seems disappointing."
Disclosure: Long SHLD
Wednesday, April 21, 2010
My Model: CV.IM - Mark Holder
Monday, April 19, 2010
The index was up a strong 1.4% in March easily surpassing estimates of 1.0% and February was also raised to 0.4% from 0.1%. All in all 1.7% was added to the index. The index is now at its highest level. What strikes me as odd is that the Conference Board quotes remain somewhat tepid. The index has grown solidly for a year now and the 6 month change is at 5.2% (or 10.6% on an annual pace) yet they use the term 'slow recovery'. Their numbers suggest anything but that.
- Says Ataman Ozyildirim, economist at The Conference Board: “The U.S. LEI has risen steadily for a year, and its six-month growth rate has remained fairly stable in recent months – led by improvements in financial and labor market indicators. Payroll employment made its first substantial contribution to the coincident economic index, suggesting a recovery that is beginning to gain traction.”
- Adds Ken Goldstein, economist at The Conference Board: “The indicators point to a slow recovery that should continue over the next few months. The leading, coincident and lagging series are rising. Strength of demand remains the big question going forward. Improvement in employment and income will be the key factors in whether consumers push the recovery on a stronger path.”
The general media hpye is this leads to the much needed correction. Will the market drop 10% or more? Its possible that this leads to tougher financial regulation especially if most people fall for the mis-informed headlines. Rather it seems illogical that a trade from over 3 years ago that isn't even part of the financial markets anymore causes lasting damage. A game changer needs to impact current revenues and greatly impact future revenue streams and profits. How much does this change GS earnings? Likely little to known. Tougher derivatives regulation will have an impact, but that was already expected to a certain extent. GS stock dropped $12B today. Nobody suggested they'd be impacted that much. Mid morning trading will tell the story. If Mutual Funds are loaded with cash from the weekend, then the impact will likely be short lived.
Cramer had what I thought was a great summary on his Mad Money show of the weak case of the SEC. Lots of people seem to hate him because he is seen as a perma-bull which is hardly the case. As I argued on Friday, this was a transaction between very sophisticated parties. The case against GS seems pretty weak to suggest that a large bank would walk away from a deal because a relatively obscure Hedge Fund wanted to bet against it. Remember that every deal has a seller. If I buy a stock, should I be told the name of the party that sold me the stock? Nope. Thats the way this business works.
This is clearly not the best case that the SEC could bring against a Wall Street firm. Whats clear is that its the highest profile case they could use to grab headlines. Where are all the fraud cases against the companies that went out of business? Why the most successful firm? But why only a small known VP? Once you get past the headlines and you understand the housing market and relative smallness of Paulson back in late 2006, it becomes clear that most would've taken this bet. After all, housing supposedly never declined.....
Buy on weakness tomorrow unless it's something massive enough to cause technical damage to the 10/20ema. Its highly unlikely that the market will stall when 75% of the analysts talking since early Friday have predicted such a move. Go back to the housing market and recall how many people including the Fed Chairman called for a recovery as the subprime market started rolling over. Markets roll over when everybody suggests buying the dips but nobody is left to buy. Currently most people remain underinvested and actually need to buy the market.
EDIT 9:45AM: Market didn't even open as low as expected Leading Indicators were very bullish. More on that latter.
Friday, April 16, 2010
After the bell, news has come out that not only did GS lose $90M on the questioned deal, but Deutsche Bank (DB) lost $500M. Both banks were instrumental in working with John Paulson to structure these deals that he shorted. The SEC believes the intent was to defruad the buyers in this case. According to GS they lost $90M in this transaction because they accepted residual risk as part of the transaction. Now its possible they lost $90M here, but then turned around and shorted the market elsewhere to profit. DB supposedly lost $500M because they were unable to unload or maybe didn't want to unload the securities because they thought Paulson was wrong. Regardless it seems highly unlikely that either firm intentionally set up the deal for one party to lose. Its very apparent that back in late 2006 that just about every party wanted to be long mortgage securities. They facilitated a transaction between a willing buyer and a seller.
Nobody knew Paulson back then and I seriously doubt anybody thought for a 2nd that they should follow his trade. Very few firms profited to a great extent from the downturn in housing so I find it very questionable that these charges will stick. GS wasn't selling an island that didn't exist. Even Paulson seemed to question whether he made the right bet. Would housing really decline?
Great comments from Cramer before the news from GS became public. The SEC must find other information where GS actually profited on this deal to prove fraud. Regardless the news flow will be interesting prior to the open on Monday, but its difficult to see how a 3 year old transaction leads to a market correction.
We added back to the Foster Wheeler (FWLT) shares that we sold for the Growth and Hedged Growth Portfolios last month and started a new position for the Opportunistic Portfolio. Technically FWLT is in a position to breakout with the 20ema crossing the 200ema and we like the future prospects for infrastructure growth. Asia and the Middle East (OPEC) should be ramping up now that world growth is flourishing. Best of all, FWLT is still considerably below the $80 high they hit in 2008.
On the earnings front, FWLT made $3.73 in 2008 and they likely will retest those levels by 2012. The estimate for 2010 is that they'll make $2.33. We expect the $2.64 estimate for 2011 will likely go much higher. Jacobs Engineering (JEC) has the same earnings profile and it currently trades at $47 versus the $30 for FWLT. In our opinion, FWLT has upside versus the sector and the sector has upside versus the market.
Wednesday, April 14, 2010
"Clarity is one of the most expensive things in the world to wait for. People have a perverse desire to buy high, sell low," Fisher said.
Fisher basically backs our thoughts but of course managing $40B allows him alot more interview time. His biggest point that we've pounded the table on for a long time is the interest rate spread. A large yield curve typically generates economic expansion. Its becoming very apparent that this time is no different.
Its also interesting how he highlights another typical issue of a market: fixation with the last markets winners. Whether the naysayers that correctly called the downturn or an asset class such as bonds. In both cases, investors are missing the current bull market in stocks and ignoring the winners. You can follow the last markets winners. Always look for tomorrows champoins.
In summary, Ken thinks this isn't 1932 so the markets should rally in the 2nd year after a recession. So far he is right because the rally since March 9th has been strong.
- markets have failed to take into account the big spread between short- and long-term interest rates, a classic indicator of an economy on the verge of recovery.
- Investors and the broad public do not view optimists as heroes and are fixated on the downside, failing to see all the signs that the global economy is doing very well, he said. Who was right calling the bear market garners more attention than who was right calling its end.
- Data shows that since the late 19th century the total return of stocks, which includes dividends, has always gained in the second 12 months after a bear market has bottomed, he said.
- On a price-only basis, stocks failed to gain in the second 12 months after the trough only once, in 1932, he said.
In general, PNX continues to be a cheap insurance play. Analysts expect them to earn roughly $.70 this year and next meaning that they are only now trading at 5x expectations. Probably remains a huge value until the $6 range.
The stock is about a 1.5% holding of our Growth Portfolio. Its extended today so I wouldn't rush out to buy more. Look for shallow pullbacks on the way up. Todays move of the 20ema crossing the 200ema as likely brought in a lot of short term technical traders.
Tuesday, April 13, 2010
If anything the deal signals the demand China expects in the next decade. Paying 20% now may seem very cheap if we revisit the old highs which is likely very dependent on China demand. Who better to know those needs then China itself. The market might want to listen to what their saying with this purchase.
- The company known as Sinopec Group agreed to pay at least $650 million more for ConocoPhillips’s 9 percent stake in Syncrude Canada Ltd. compared with an estimate by Macquarie Securities. The premium could have been narrowed by a stronger yuan, currently constrained by a peg to the dollar.
- “Sinopec seems to be paying a higher premium,” said Gordon Kwan, head of regional energy research at Mirae Asset Securities in Hong Kong. “With talk of the yuan appreciating, this will increase China’s purchasing power in M&A deals.”
- The country’s drive to own overseas energy assets is also spurred by price volatility in the oil futures market. Crude in New York rose to a record $147.27 a barrel on July 11, 2008, before plummeting to a four-year low of $32.40 on Dec. 19 that year as the worst recession since the Great Depression eroded fuel demand. Prices have since more than doubled to about $84.
- “China’s fear is that it will be held captive by the futures market,” said Lee Boon Keng, the Singapore-based deputy chief investment officer at Bank Julius Baer & Co. “As oil rises to $100 a barrel again they need to secure more supply. China needs oil and other resources to feed growth of about 8 percent a year, but will there be enough to feed this kind of growth over the next five years?”
- China, the world’s largest energy consumer behind the U.S., relied on imports to meet more than half of its oil needs last year. Chinese oil consumption reached 8 million barrels a day in 2008, according to the BP Statistical Review of World Energy.
Sunday, April 11, 2010
Epoch Investment Partners is a specialized money management firm that oversees some $12B in assets (just slightly more then Stone Fox....lol). According to the article they've easily beaten the market because they focus on companies with strong cash flows that distribute the money to shareholders via buybacks, dividends, or paying back debt. They'll also consider companies that make acquisitions or expand internal capital projects as long as the deal exceeds the cost of capital.
Our Net Payout Yield Portfolio focuses on companies with strong buybacks and/or dividends. The debt position of a company is a 3rd consideration but not as big of a focus. Though, any company that issues debt to buyback stock is off our list. This portfolio is beating the market for a 4th consecutive year so it clearly works to focus on this concept.
All in all they have a similar approach to ours in that companies that have free cash flow will prosper. Focusing on just the net payout yield (dividends + buybacks) is more of a focus on the companies managements confidence in the future compared to the markets. In theory, the level of the yield signifies that the market is too pessimistic or overly optimistic. Naturally it's similar to the Dogs of the Dow theory, but it incorporates buybacks as well. Also, we think looking at the SP500 universe is much more attractive then just the Dow.
Epoch clearly has a great method for beating the market. Earnings and cash are always king. Interesting read about common sense investing. Companies that make money and return it to shareholders will typically provide market beating returns. This type of investing doesn't grab the headlines, but at the end of the day you'll have more money then the market.
- Their methodology involves identifying companies that intelligently allocate free cash flow. Among the ten strategies they've crafted, five have of at least five years, and each of these has surpassed their relevant benchmarks as of Dec. 31. Epoch's largest strategy by assets, Epoch U.S. Value, with $3.1 billion, has a five-year annual return of 3.2% (net of fees), versus the Standard & Poor's 500's 0.4%.
Thursday, April 8, 2010
It was encouraging to see that March comps were positive marking the first time in over 2 years of positive monthly comps. Most retailers had strong March numbers so this really isn't anything special from KONA, but a good sign nevertheless. It'll be interesting to see how they line up with the industry on comps for March.
The new CEO clearly came on board at the right time. Management always looks brilliant in a good economy. The verdict is still very much out, but at the very least they are now keeping up with the trends. Listen to some of the earnings calls in 2009 and you'll see that several hedge funds clearly thought KONA had the worst comps in the industry (Their comps were so bad I didn't see the need to confirm). This always provides an extra tailwind for new management. Those easy comps will provide extra fuel for the stock price in 2010 as well.
- For the first quarter of 2010, restaurant sales increased 8.2% to $21.1 million from $19.5 million a year-ago, including a decline in comparable restaurant sales of approximately 2.5%. During its fourth quarter conference call, the Company had previously guided to restaurant sales of $19.4 million to $20.4 million for the first quarter.
- The quarterly comparable restaurant sales decrease of 2.5% compares to a 9.6% decrease in the prior year period and an 8.1% decrease during the fourth quarter of 2009.
- "During March, our comparable restaurant sales rose 3.6% and were positive for the first time since February 2008. We are cautiously optimistic that this momentum will continue throughout 2010 which will enable us to leverage costs and ultimately, improve our bottom line results," said Marc Buehler, President and Chief Executive Officer of Kona Grill.
During the 1994 and 1995 rally the market had 2 stretches of roughly 70 days where the market didn't have a pullback of 1%. It would not shock me at all to see that record broken. It also wouldn't shock me to see a 2% pullback tomorrow. For the record to break, we're looking at 5 more weeks without a big selloff. Seems absurd, but do you really want to bet against it? Most people seem to expect a selloff even when history provides evidence that these abnormal scenarios tend to always happen after recessions.
The facts from the below report suggest that we are in fact due for multiple such rallies. After the early '90s recession, the market had 6 such rallies. After the 2001 recession, the market had at least 2 rallies in 2004 that can be tied to the recession and even a couple of follow ups in 2006 and 2007. If anything, instead of fighting this rally people should be looking for more to the tune of at least 1 if not 2, 3, 4, or even 5. So many people expect a selloff which greatly increases the odds that we won't have one.
Tuesday, April 6, 2010
The stock has huge upside since the first 2 mines won't be consolidated until May. Even with that, PUDA expects to earn $1.10 to $1.50 in 2010 based off a profitable coal washing business plus a partial year of these 2 thermal mines. Lots of upside from the other 6 thermal mines and especially the 4 new coking coal mines they just got approval to consolidate.
Read more about PUDA from a post we wrote on March 15th - Puda Coal Cools Off But Will Heat Up Again.
Monday, April 5, 2010
The big winners were the portfolios largest holding AerCap Holdings (AER) gaining 7% and speculative China coal play Puda Coal (PUDA) up 8.5%. Also helped that large holding Riverbed Tech (RVBD) was up 5.4% and other holdings like Regions Financial (RF) and Liz Claiborne (LIZ) were up 5%.
The market is overbought short term, but long term we still see incredible value in all those stocks mentioned. AER and PUDA could easily rack up earnings in the $2+ range in 2011 and they only trades at $13 and $10, respectively. They both could see $20 assuming they meet earnings expectations.
Growth Portfolio numbers via marketocracy.com. See links to all portfolio performance numbers on the right hand side. Opportunistic numbers are updated prior to market open the following day on Covestor.
- "The NMI (Non-Manufacturing Index) registered 55.4 percent in March, 2.4 percentage points higher than the seasonally adjusted 53 percent registered in February, and indicating growth in the non-manufacturing sector. The Non-Manufacturing Business Activity Index increased 5.2 percentage points to 60 percent, reflecting growth for the fourth consecutive month. The New Orders Index increased 7.3 percentage points to 62.3 percent, and the Employment Index increased 1.2 percentage points to 49.8 percent. The Prices Index increased 2.5 percentage points to 62.9 percent in March, indicating an increase in prices paid from February. According to the NMI, 14 non-manufacturing industries reported growth in March. Respondents' comments are mostly positive about business conditions and the direction of the economy."
Index continues its steady growth out of the Great Recession. Its been a lot more methodical then some hoped, but over the last 2 months its finally hit the tipping point. At this point, I'd expect the remaining companies holding out on adding to inventories to finally relent as the recovery takes hold.
|Mar 2010||55.4||Sep 2009||50.1|
|Feb 2010||53.0||Aug 2009||48.2|
|Jan 2010||50.5||Jul 2009||46.7|
|Dec 2009||49.8||Jun 2009||46.3|
|Nov 2009||48.4||May 2009||44.5|
|Oct 2009||50.1||Apr 2009||43.9|
|Average for 12 months — 48.9|
High — 55.4
Low — 43.9
10% more companies have cut inventory since December. Really?
Sunday, April 4, 2010
Today SD announced the purchase of Arena Resources (ARD) which mainly focuses on oil production in the Permian Basin in Texas for $1.6B. This marks a major shift for SD into oil that the CEO claimed at a conference a few months back was '10x more profitable to drill for then gas'. Guess that should've signaled to the markets that SD was going to make such a move.
Recently CHK announced that they were moving more drilling resources towards oil and away from nat gas. The April Investors Presentation shows a goal of 20% oil production and a probable drop of roughly 10% of rigs drilling for nat gas. Even with this they expect huge growth in production that is undoubtedly not helping prices. With oil being a global commodity that has benefited from Asian demand and a lack of any new cheap production, its actually surprising that this move didn't happen sooner. Nat gas still remains a domestic commodity tied completely to US demand which has lagged due to low industry demand.
Stone Fox has remained negative on nat gas companies as supplies had remained high and demand low. Its interesting that this deal takes place as supplies have finally come back within the 5 year averages and the US economy is showing signs of picking up. Last week the ISM index hit 59 showing signs of accelerating demand. This is definitely not the type of deal that signals a top or turning point in the price ratio between oil and gas, but it does strike us as buying the higher priced commodity. As more and more explorers makes similar moves, the prices are likely to revert closer to normal ratios.
Details on the deal:
- Arena shareholders will receive stock and cash consideration valued at $40 per share of Arena common stock based on SandRidge's April 1 closing price. This represents a 17% premium for Arena shareholders. SandRidge will issue 4.7771 shares of SandRidge common stock and pay $2.50 in cash for each share of Arena common stock
- The transaction uniquely positions SandRidge as one of the largest producers of West Texas conventional oil and gas. The oil opportunities will come primarily from drilling and development of shallow, low risk reservoirs located on the Central Basin Platform ("CBP"), a part of the Permian Basin in West Texas. The CBP has produced over 13 billion barrels of oil since the 1930s. The combined company will have over 200,000 net acres in the Permian Basin and 5,700 identified locations to drill primarily in the shallow San Andres and the Clear Fork formations. Additional upside exists with down spacing and future secondary and tertiary potential. SandRidge also owns low risk natural gas properties in the Pinon Field, and significant exploration opportunities in the West Texas Overthrust.
- transaction to be accretive to 2011 cash flow per share.
Disclosure: No position.
Friday, April 2, 2010
The portfolio returned 15% versus a little over 6% for the SP500. 2nd place had 13.37% and 5th place was already down to 9.65%. The top 5 is listed on the main page at CVIM and below.
Definitely can't promise returns like that every month, but we'll strive to continue to beat the market averages.
Covestor is an interesting medium so check it out. Besides investing with me for as little as $5K you can also now invest with numerous other RIAs that have substantial amounts of assets under management. For example, Naviller and Associates is well known on Wall Street and manages over $2B. For as little as $10K, you can spread your money between the 2 of us and diversify your risk away from any one manager. This is where the Multi Managed Account becomes so interesting to people below the $100K and in most cases $250K threshold. In the past, you'd be stuck with just one investment manager, but CVIM allows you to spread that risk amongst a larger group. And with your money at a 3rd party brokerage like IB, you no longer have to worry about the issues faced by Madoff and Stafford investors.
Check out the portfolio: Mark Holder
Last Month Return*
|R Y Foo||4||10.95%|
|R Y Foo Agg||5||9.65%|
Thursday, April 1, 2010
With the employment index slipping slightly to from 56 to 55 and remaining below the overall index that should signal bullish corporate profits in Q1 and likly Q2.
- The report was issued today by Norbert J. Ore, CPSM, C.P.M., chair of the Institute for Supply Management™ Manufacturing Business Survey Committee. "The manufacturing sector grew for the eighth consecutive month during March. The rate of growth as indicated by the PMI is the fastest since July 2004. Both new orders and production rose above 60 percent this month, closing the first quarter with significant momentum going forward. Although the Employment Index decreased 1 percentage point to 55.1 percent from February's reading of 56.1 percent, signs for employment in the sector continue to improve as the index registered a 10 percent month-over-month improvement, indicating that manufacturers are continuing to fill vacancies. The Inventories Index provided a surprise as it indicated growth for the first time following 46 months of liquidation — perhaps signaling manufacturers' willingness to increase inventories based on expected levels of activity."
|MANUFACTURING AT A GLANCE |
|Customers' Inventories||39.0||37.0||+2.0||Too Low||Slower||12|
|Backlog of Orders||58.0||61.0||-3.0||Growing||Slower||3|