By Mark Pender
NEW YORK (MNI) – MNI’s U.S. capital goods indicator rose nine
tenths in the May 4 period to 54.4, the second straight reading over 50
to indicate expansion in year-on-year business activity, according to
the results of MNI’s weekly survey released Monday.
Sales are a year-on-year +4.6% after currency effects which are
shaving off one percentage point.
Income is at +2%. Sample size in the period is 527 companies.
Guidance from MNI’s sample is pointing to a low single digit
sequential gain for second-quarter shipments of nondefense capital
goods. The sample is generally more confident about the second quarter
than about the second half of the year.
Energy and farm equipment are two leading sectors with most reports
on aerospace also strong. Indications on the heavy truck sector are
mixed while indications on electronics point to a long awaited leveling
but not much of a snap back.
Regional commentary is abundant and consistent and represented in
this week’s sample by Albany International (AIN) which makes fabric
belts for paper machines.
Albany has been focusing on its markets in Asia, Eastern Europe,
and the Middle East to make up for its exposure to Western Europe: “Our
primary area of concern, and the primary source of difficulties in Q1,
is the weakness in Europe. A further deterioration in the European
economy, coupled with the ripple effects this could have on the Asian
and North American economies, would put downward pressure on the second
half of the year.”
Editor’s Note: MNI compiles its capital goods index based on a
weekly sample of company news and data.
** MNI New York Bureau: 212-669-6430 **
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