Text 2849, 120 rader
Skriven 2004-10-02 04:20:00 av Jeff Binkley (1:226/600)
Ärende: Economy
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More bad news for the democrats.....

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http://biz.yahoo.com/ap/041001/economy_16.html

Associated Press
Manufacturing Activity Remains Strong
Friday October 1, 5:36 pm ET
By Adam Geller, AP Business Writer
Manufacturing Remains Strong in September; Construction Spending Surged to
Record High in August


NEW YORK (AP) -- Manufacturing activity remained strong in September and
construction spending surged to a record high in August, according to a pair of
reports issued Friday that provided an optimistic look at the sturdiness of the
economy.

The Institute for Supply Management said its manufacturing index registered
58.5 in September, down from 59 in the previous month, and slightly higher than
the 58.3 reading forecast by analysts.

An ISM reading of 50 or above means the manufacturing sector is expanding,
while a figure below 50 represents a contraction. The index has been above 50
since June of last year.

"The manufacturing sector continued to grow during September, but at a slightly
slower rate," said Norbert J. Ore, chair of ISM's manufacturing survey
committee. "Both new orders and production remain strong, and employment growth
has accelerated."

Also Friday, the Commerce Department reported that construction spending jumped
in August to the highest level ever. The 0.8 percent increase to a seasonally
adjusted annual rate of $1.02 trillion reflects continued strength in the
housing market.

The increase was double what economists had been forecasting, and July's figure
was revised to reflect an even stronger month than previously estimated.

"This was an extremely strong and encouraging report," said Kenneth Simonson,
chief economist at Associated General Contractors of America.

The generally upbeat manufacturing and construction reports contrasted somewhat
with the University of Michigan's index of consumer confidence for September,
also released Friday. That reading declined to 94.2 last month from 95.9 in
August, lower than had been expected by economists.

Automakers also reported car and truck sales for September. Ford Motor Co. said
its sales fell nearly 7 percent as car sales dragged down overall results. But
General Motors Corp. said its new vehicle sales jumped 20 percent, and Toyota
Motor Corp., Nissan Motor Co. and DaimlerChrysler AG's Chrysler Group also
posted double-digit gains.

Analysts were generally upbeat in their appraisals of the economy, downplaying
concerns about consumer attitudes.

"The key is that because manufacturing is so strong, it points to some
fundamental underlying strengths in the (overall) economy," said Joel Naroff,
of Naroff Economic Advisors in Holland, Pa.

Taken together, the reports bolster the stance taken by policymakers at the
Federal Reserve that the economy has steadied and gained ground after softening
beginning in late spring. Fed Chairman Alan Greenspan and his colleagues cited
that point of view last month in deciding to raise short-interest rates.

Ore said manufacturers surveyed indicated generally favorable conditions,
although some reported problems caused by recent hurricanes. Many companies
said they have stepped up hiring of both blue-collar and white-collar workers.
Manufacturers said they are increasing their inventories, partly to hedge
against price increases, but also because business continues to improve.

Stocks rose following release of the reports. The Dow Jones industrial average
closed up 112.38 at 10,192.65. The Nasdaq composite index gained 45.36 to
finish at 1,942.20. The Standard & Poor's 500 index gained 16.92 to 1,131.50.

According to ISM, 15 manufacturing sectors reported growth, led by
miscellaneous manufacturing and followed by glass, stone and aggregate, rubber
and plastic products, industrial and commercial equipment and computers,
tobacco and apparel. Others reporting growth were transportation and equipment,
chemicals, food, wood and wood products, electronic components and equipment,
printing and publishing, instruments and photographic equipment, paper and
fabricated metals.

Manufacturers continue to report strong pressure on the prices they pay for
materials. The ISM index measuring prices registered 76, down from 81.5 the
previous month, but still indicative of higher prices.

Growth of new orders also slowed, with an index measuring them declining to
58.1 in September from 61.2 in August.

But the report also offered significant good news, particularly on jobs and
production activity. ISM, based in Tempe, Ariz., said its employment index rose
to 58.1 in September, up from 55.7 the previous month, with 11 sectors
reporting job growth.

ISM's production index also rose, registering 61.6 after a reading of 59.5 in
August.

"September was surprisingly strong given the recent slowing of growth in new
orders," Ore said.

While the ISM report focuses on manufacturing, the group's index also points to
continued growth in the economy as a whole. An ISM reading of 42.8 or higher
indicates improvement in the overall business climate, a level that has been
achieved for 35 consecutive months.

The government's report on construction showed that residential projects by
private builders rose 1.7 percent in August to a record high of $550.6 billion,
on an annualized basis.

Commercial construction increased 0.8 percent in August to an annual rate of
$227 billion, its highest point since June 2002.

Government spending on big public works projects, meanwhile, fell 1 percent to
an annual rate of $237.6 billion, a sign of cutbacks in spending on schools and
highways and streets.

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