Contraction:

Highlights

September factory orders fell 0.6 percent with durable goods orders falling 1.2 percent (revised from an initial 1.1 percent decline in last week’s advance data) and nondurable goods (the new data in today’s report) up 0.1 percent. Total unfilled orders have been flat this year and were unchanged in September while inventories rose 0.3 percent in contrast to shipments which fell 0.2 percent. Orders for commercial aircraft, pulled down by the grounding of the Boeing 737 Max, have been struggling this year and were down 11.8 percent in September.

Remains in contraction (below 50):

The slow motion train wreck continues unabated and when employment goes bad, it all goes bad:

Highlights

On the low side of expectations but not at increasing rates of contraction are the results of ISM’s manufacturing report for October. At 48.3, the index missed Econoday’s consensus by 1 point but gained a 1/2 point from September. New orders improved nearly 2 points in October but, at 49.1, are still under breakeven 50. New export orders, however, improved markedly, up more than 9 points and back over 50 at 50.4. Yet total backlogs are a major weakness for ISM’s sample, down another point and in deep contraction at 44.1.

Elsewhere contraction is roughly as deep as September, including production down nearly a point to 46.2 and employment up 1.4 points but still under 50 at 47.7. The sample drew down their raw material inventories but less so than September while, in a sign that capacity constraints are minimal, supplier delivery times posted a rare outright decline in the month. Given the indication from delivery times, the prices paid index is not surprisingly pointing to lower prices, down more than 4 points to 45.5.

The good news in this report is the rise in export orders, a move confirmed by the PMI manufacturing report which was released earlier this morning. Yet overall conditions are still very soft and are not pointing to any year-end acceleration for a sector that has been holding back the 2019 economy and where export-related trouble has helped trigger three straight rate cuts from the Federal Reserve.

With today’s numbers private sector employment continues its rapid deceleration brought on by the collapse in global trade from the tariffs:

GDP is also decelerating for the same reasons:

Contraction:

The collapse continues:

Not a good sign:

Oil capex decline:

Oil Rig Count Plunges To Lowest Level Since 2017

A Death Sentence For Small Oil & Gas Drillers

Below 50 is contraction:

The global collapse continues unabated:

Highlights

An emphatically weak set of durable goods headlines for September raises the alarm for the health of the manufacturing sector while unexpectedly substantial contraction in capital goods orders deepens specific questions on the outlook for business investment. Durable goods orders fell a monthly 1.1 percent in September, on its face significantly weak but roughly near expectations in contrast to ex-transportation orders which fell 0.3 percent to just make the bottom end of Econoday’s consensus range. Well below the bottom of expectations is a 0.5 percent drop in core capital goods orders (nondefense ex-aircraft), one intensified by a downward revision to August which now shows a 0.6 percent monthly decline that followed no better than no change in July.

Turning back to the headline, an 11.8 percent decline in commercial aircraft is a key negative for September but no surprise for a component, reflecting the Boeing 737 Max grounding, that has been struggling badly this year. Reflecting the GM auto strike is 1.6 percent decline in motor vehicle orders and a 1.5 percent decline in related shipments.

Breaking down capital goods orders, weakness appears to be concentrated in fabrications, down 1.5 percent in the month, and computers which fell 0.9 percent. Machinery actually rose 0.2 percent in the month but benefited from an easy comparison following 0.3 percent and 1.0 percent declines in the prior two months. Communications equipment, like machinery, also rose in September but following steep declines in prior months.

Shipments for core capital goods fell 0.7 percent in September following no change in August and another 0.7 percent decline in July. These three results will be part of the third-quarter GDP mix for nonresidential investment, a component that may well be on a descent and one the Federal Reserve may well tie to weakening global demand for high-end US goods. Today’s results increase the force of those on the FOMC who are pushing for continued rate cuts, including perhaps at next week’s meeting.

Other readings of note include another weak showing for total unfilled orders, at no change, and a 0.4 percent dip for total shipments that follows declines in both August and July. Likely reflecting weakness in shipments is a sharp and perhaps unwanted build in total inventories of 0.5 percent in September.

Up a bit for the month but the trend still looking lower:

Deep into contraction: