There are conflicting reports on activity in the nation's manufacturing sector. One report says it moved into high gear in June, hitting a near three-year high, while a separate one indicated conditions were the weakest since last September.
The Purchasing Managers' Index from the Institute for Supply Management moved up 2.9 percentage points last month to 57.8%, its highest level since August 2014, and better than analysts' expectations. This also marked the 10th consecutive month it has been above 50%, which indicates expanding manufacturing activity.
The New Orders Index registered 63.5%, an increase of 4 percentage points from the May reading, while the Production Index registered 62.4%, a 5.3 percentage point increase compared to the May level.
Of the 18 manufacturing industries surveyed by the Institute for Supply Management for the index, 15 reported growth in June.
However, the report stands in sharp contrast to a similar one from IHS Markit, which showed manufacturing growth weakened in June.
The IHS Markit Purchasing Managers' Index registered 52, down from 52.7 in May. While still above the no-growth level of 50, it signaled the least marked improvement in manufacturing business conditions in nine months.
IHS Markit said slower rates of output and new business growth were the main factors weighing on the headline PMI in June, which more than offset a stronger contribution from the stocks of purchases component.
Unlike the ISM survey, which is more closely watched by economists, the IHS Markit report has been sliding lower since the peak seen in January. The June reading points to a stagnation, at best, in the manufacturing output data.
So which survey is best to believe?
“I guess the truth lies somewhere in the middle, but it is quite bizarre reading…. it seems like they measured two different countries, said Peter Boockvar, chief market analyst with The Lindsey Group, on his website,
