Wall Street News
The Institute for Supply Management surveys over 300 manufacturing companies on a number of factors. They review such items as: employment, production, new orders, deliveries and inventories. In simplistic terms, a composition of the information is constructed and positive readings over 50 indicate expansion in the sector and below 50 is negative suggesting contraction.
What does it mean to individuals and investors?
They need to keep their fingers on the pulse of the economy because it dictates how various types of investments will perform. By keeping track on economic information like the ISM manufacturing index, investors will know what the economic scenery looks like for these types of markets. So depending on your investment strategy; in the stock market, which likes to see healthy economic growth because that translates to higher corporate profits. Investing in the bonds you prefer less rapid growth. The bond market is much more sensitive to whether the economy is growing too quickly and hence this report.
The ISM manufacturing information gives a more in-depth picture of the manufacturing sector. All the factors reviewed show individually and as well as a whole, different points. How busy it is and where things are headed. As the manufacturing sector is a major source of cyclical variability in the economy, this report has a big influence on the markets.
More than one of the ISM sub-indexes provides insight on commodity prices and clues regarding the potential for developing inflation. The Federal Reserve watches this report closely helping it to determine the direction of interest rates when inflation signals are going off.Definition
When is this report published?
This report comes out on the first business day of the month. Data is for the previous month. June is report July. Unlike some reports, there are no revisions.
Stayed tuned for continual financial updates.
Gallup's self-reported Consumer Spending measure is based on a question that Gallup tracks daily, asking a nationally representative sample of about 500 adults, aged 18 and older, and reports monthly based on approximately 14,000 interviews. Gallup asks Americans each day to estimate the amount of money they spent "yesterday," excluding the purchase of a home, an automobile or normal household bills. The survey is conducted with respondents contacted on landlines and cellphones
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