The Economic Model and PMI Index charts were updated with October 2012 data.
The index closed at 51.70 which shows the economy is still growing but at a slower pace. Some interesting comments from respondents posted below. You can read the full PMI report at the ISM Website.
- "Market is still very soft." (Paper Products)
- "Business is picking up." (Furniture & Related Products)
- "[Our] 4th quarters usually begin to show a slowdown in demand, and this year is no different; prices are also dropping." (Wood Products)
- "Demand down slightly due to customers pre-buying ahead of announced material price increases." (Plastics & Rubber Products)
- "The slowing of capital expenditure in Europe and China has lowered our backlog for Q4." (Computer & Electronic Products)
- "We see a general softening in the steel and automotive markets in the fourth quarter." (Fabricated Metal Products)
- "Cuts in healthcare reimbursement rates continue to negatively affect top-line revenue." (Miscellaneous Manufacturing)
- "Business conditions stable to slightly improving." (Transportation Equipment)
- "Sales and order intake have slowed." (Primary Metals)
- "Europe is still very much a concern. Global recovery is still fragile." (Chemical Products)
Click here for an interactive version of the PMI chart shown below.
MTR Economic Model: MTR-EM
The MTR Economic Model (MTR-EM) measures the strength of the consumer and is used as a leading indicator of consumer spending. Consumer spending is the force behind bull markets, and lack of consumer spending brings in the bears.
Real-Wages (green line) is flat year over year. This shows consumer spending will have minimal impact on stock prices. The trend in real-wages appears to be downward. Items that will push real-wages lower include inflation and companies freezing any types of pay increases. If this number goes below -2% year over year typically a market downtrend will follow.
Click here for an interactive version of the chart shown below.