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Afternoon Note

Manufacturing

By Charles Payne, CEO & Principal Analyst
9/23/2019 1:36 PM

The major indices have been trading in a narrow range, in and out of the green, and are currently slightly positive.  Flash PMI manufacturing data out of Eurozone weighed on the market at the start of trading.  Germany’s flash PMI for September was the lowest since 2009, with a read of 41.4 (anything below 50 indicates contraction).  Here at home, however, it was a different story, as September improved from 50.3 to 51.1.  Business activity in both manufacturing and services expanded at a more robust pace than August.

In addition, services employment fell to 49.1 in September, the lowest since December 2009, from 50.4 the prior month. This could be a sign the cyclical top in employment could have hit.

Chris Williamson, chief business economist at IHS Markit, said, “Jobs are now also being cut across the surveyed companies for the first time since January 2010, as firms have become more risk averse and increasingly eager to cut costs... Key to the recent deterioration has been a further spill-over of the trade-led slowdown in manufacturing to the service sector.”

The benchmark U.S. Treasury yield is on the decline again, down 7 basis points to 1.69%, and the 2 year is down to 1.65%.  The yield curve is getting close to inverting again.   The greenback is up with the dollar index at 98.69. 

Real Estate, Consumer Discretionary and Consumer Staples are the leaders today, while Healthcare is the laggard. 

S&P 500 Index

+0.09%

 

Communication Services (XLC)

 

-0.37%

Consumer Discretionary (XLY)

+0.55%

 

Consumer Staples (XLP)

+0.55%

 

Energy (XLE)

 

-0.02%

Financials (XLF)

+0.12%

 

Health Care (XLV)

 

-0.49% 

Industrials (XLI)

 

-0.06%

Materials (XLB)

 

-0.22%

Real Estate (XLRE)

+0.51%

 

Technology (XLK)

+0.41%

 

Utilities (XLU)

+0.29%

 
 

 

 

 

 


 

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