U.S. Manufacturing PMI Hits Seven-Month High, Boosted by Trump Optimism
Executive Summary
S&P Global's Manufacturing PMI rose to 50.1 in January, driven by increased manufacturing output and rising optimism in the sector. The composite PMI, which includes services activity, declined slightly to 52.4 due to decreased activity in services. However, analysts remain confident in the overall business outlook.
Key Findings
* Manufacturing PMI increased to 50.1 in January, from 49.4 in December, indicating expansion in the sector.
* Manufacturing output index climbed to 50.2, from 47.7 in December.
* Composite PMI fell to 52.4, but analysts believe the decline in services activity is temporary.
* Hiring has increased at a rate not seen in two-and-a-half years due to improved business outlook.
Implications for Investors
Equity strategists are closely monitoring manufacturing PMI data as a potential indicator of future earnings growth. Analysts expect the ISM Manufacturing Index, due February 3rd, to rise above 50 for the first time in 26 months, which could signal an acceleration in cyclical earnings growth.
Source
S&P Global Market Intelligence