April 26, 2024

You are here: Home / Archives for gauge

Private Sector Added 135,000 Jobs in May, Survey Shows

June 5, 2013 by Leave a Comment

Private employers added 135,000 jobs in May, the ADP National Employment Report showed on Wednesday, an acceleration from April but missing forecasts for a gain of 165,000. April’s private payrolls were revised down to an increase of 113,000 from the previously reported 119,000.

“The number was weak,” said Mark Zandi, chief economist at Moody’s Analytics, which jointly developed the report.

“The ADP (data) is suggesting instead of job growth stepping up, it’s actually stepping down as we move into the summer months,” Zandi told reporters. “It’s not like we’re falling off a cliff, it just feels like we’re throttling back a little bit.”

The ADP report showed manufacturers shed payrolls in May and a separate report indicated jobs growth in the vast services sector was weak last month, with a gauge of employment at services firms falling to its lowest in close to a year.

The pace of economic growth is expected to cool in the current quarter from the 2.4 percent rate seen in the first three months of the year, partly due to fiscal belt-tightening in Washington.

The goods producing sector cut 3,000 jobs in May, with a drop of 6,000 positions at manufacturing firms, which could be partially due to defense spending cutbacks, Zandi said.

U.S. stocks were lower in morning trade, while Treasury debt prices climbed. The dollar was slightly weaker against a basket of currencies.

Activity in the U.S. services sector picked up slightly in May, with the Institute for Supply Management’s services index edging up to 53.7 last month from 53.1 in April. That topped economists’ expectations for 53.5.

A reading above 50 indicates expansion in the sector. The May reading was still off this year’s peak of 56.0, which was hit in February.

The forward-looking new orders component rose but the employment measure slipped to the lowest level since last July at 50.1 from 52.0.

Even with the lackluster growth, the services industry held up better than its manufacturing counterpart, which contracted in May, according to data from ISM released earlier in the week.

Data on Wednesday added to signs of a slowdown in manufacturing as new orders for factory goods rose in April but not enough to reverse the prior month’s plunge.

In a busy day for economic releases, yet another report showed unit labor costs fell in the first quarter by 4.3 percent, the most in four years, although the reading appeared to be distorted by a shift in employee compensation during the prior period to avoid a tax hike.

FED IN FOCUS

The ADP figures come two days ahead of the government’s more comprehensive labor market report, which includes both public and private sector employment.

That report is expected to show job growth increased only slightly, with nonfarm payrolls seen rising by 170,000 compared to the 165,000 seen in April.

Friday’s report will get even more scrutiny than usual with investors trying to gauge when the Federal Reserve may slow its current $85 billion a month bond-buying program, which is aimed at propping up the economic recovery.

“We have been seeing significant differences in ADP and nonfarm payrolls for months but regardless, it still doesn’t suggest that the labor market is strong enough for the Fed to start tapering,” said Andrew Wilkinson, chief economic strategist at Miller Tabak Co.

Since the report was revamped late last year, ADP’s figures have missed the government’s private payrolls numbers by an average 42,000 in either direction, according to High Frequency Economics.

“That 42,000 average miss for the past seven months is better than the 58,000 average in the prior seven months, although seven months of history is not conclusive,” wrote Jim O’Sullivan, High Frequency Economics’ chief U.S. economist.

Nervousness that the Fed may taper bond purchases sooner than had been expected sent fixed 30-year mortgage rates up 17 basis points to average 4.07 percent in the week ended May 31, the Mortgage Bankers Association said.

Last week’s interest rate was the highest since April 2012 and the first time rates have been above 4 percent since early May of last year.

Demand for refinancing was hit hardest by the acceleration in rates, with applications slumping 15.0 percent. The gauge of loan requests for home purchases – a leading indicator of home sales – held up relatively better, falling just 1.6 percent.

(Additional reporting by Angela Moon in New York and Jason Lange and Lucia Mutikani in Washington; Editing by Andrea Ricci)

Article source: http://www.nytimes.com/reuters/2013/06/05/business/05reuters-usa-economy-employment-adp.html?partner=rss&emc=rss

Filed Under: Economy News Tagged With: , ,

Reports Show Weaker Hiring and Service Sector Growth

April 3, 2013 by Leave a Comment

WASHINGTON (AP) — Two reports showed Wednesday that American service companies grew more slowly in March and private employers pulled back on hiring. The declines suggest businesses may have grown more cautious last month after federal spending cuts took effect.

The Institute for Supply Management said that its index of nonmanufacturing activity fell to 54.4 last month. That is down from 56 in February and the lowest in seven months. Any reading above 50 signals expansion.

Slower hiring and a steep drop in new orders drove the index down. A gauge of hiring fell 3.9 points to 53.3, the lowest since November.

The group’s report covers companies that employ roughly 90 percent of the work force, including the retailing, construction, health care and financial services industries.

A separate report from the payroll processor ADP also pointed to slightly weaker hiring in March. ADP said private employers added 158,000 jobs in March, down from 237,000 the previous month. Construction companies did not add any jobs after three months of solid gains.

Economists were not overly concerned with the weaker reports. Several noted that ADP’s figures were less reliable than the government’s more comprehensive employment report, which comes out on Friday.

Still, many say the pace of hiring has probably dropped off from the previous four months, when employers added an average of 200,000 net jobs a month. And a few reduced their forecasts for March job growth after seeing the two reports.

Jim O’Sullivan, chief United States economist at High Frequency Economics, now expects just 160,000 net jobs in the March employment report, instead of 215,000. Jennifer Lee, an economist at BMO Capital Markets, said her group had lowered its forecast to 155,000, from 220,000.

Ms. Lee said businesses might have temporarily suspended hiring because they wanted to see the impact of $85 billion in government spending cuts, which began on March 1.

Still, most economists say any slowdown is likely to be temporary. Most say growth accelerated in the January-to-March quarter to a 3 percent annual rate, buoyed by a resilient consumer and a steady rebound in housing.

And even if growth slows in the April-to-June period to roughly 2 percent, as some predict, that would still leave the economy expanding at a solid pace in the first half of the year.

Article source: http://www.nytimes.com/2013/04/04/business/economy/survey-shows-158000-new-jobs-in-march.html?partner=rss&emc=rss

Filed Under: Economy News Tagged With: , ,

Market Rally Continues, Though Volume Is Light

March 11, 2013 by Leave a Comment

The stock market rose modestly on Monday, lifting the Dow Jones industrial average to its fifth straight nominal record high and giving the Standard Poor’s 500-stock index its seventh straight advance.

The gains put the S. P. 500 just nine points away from its record closing high, which it reached in October 2007.

Stocks have rallied strongly since the start of the year, helped by signs of improvement in the economy and the Federal Reserve’s continuing program of quantitative easing to stimulate the economy. These factors have limited recent pullbacks as investors have used them as buying opportunities.

“These dips are consistently bought. There is definitely a soft floor for the market,” said Peter Kenny, managing director at Knight Capital in Jersey City.

“It’s a Q.E. bid,” Mr. Kenny said, referring to the Fed’s policy of keeping short-term interest rates near zero since late 2008. “Quite frankly, earnings have not disappointed to the point where it has been disrupted, and there is nothing out there that seems to be getting in the way of this slow but very consistent and methodical drift higher in the market.”

Trading volume was relatively light, however, suggesting the rally may be losing steam.

So far this year, the Dow has gained more than 10 percent, while the S. P. 500 is up more than 9 percent.

On Monday, the Dow industrials gained 50.22 points, or 0.4 percent, to close at 14,447.29. The S. P. 500 index rose 5.04 points, or 0.3 percent, to 1,556.22, just nine points shy of its record closing high of 1,565.15, which it reached on Oct. 9, 2007.

The Nasdaq composite index added 8.51 points, or 0.3 percent, to 3,252.87. The Nasdaq is still well below its record high of more than 5,000, reached during the dot-com boom in 2000.

Wall Street’s “fear gauge,” the CBOE Volatility Index, declined to its lowest level since February 2007, suggesting investors were not unnerved by a brief pullback in Monday’s early trading, despite expectations by many investors that a correction might be looming. The index, known as the VIX, dropped 8.2 percent to 11.56.

Boeing helped lead the Dow higher, gaining $1.71, or 2.1 percent, to $82.94, after the aircraft manufacturer said strong demand was prompting it to increase its production rates of commercial planes.

Among the stocks on the move, BlackBerry surged $1.84, or 14.1 percent, to $14.90 after ATT said it would start selling the company’s new BlackBerry Z10 touch-screen smartphone in the United States on March 22.

Dell gained 21 cents, or 1.5 percent, to $14.37 after the computer maker agreed to give the activist investor Carl C. Icahn a closer look at its books less than a week after Mr. Icahn joined the growing opposition to Michael Dell’s plan to take private the company he founded. Dell’s shares are now trading well above the offer price of $13.65 to take the company private, indicating that investors expect a higher offer.

Genworth Financial, the mortgage and health care insurer, jumped 66 cents, or 6.7 percent, to $10.50. An article in Barron’s predicted Genworth stock could almost double in the next year, bolstered by gains in the mortgage and health care markets.

In contrast, Dick’s Sporting Goods tumbled $5.49, or 10.8 percent, to $45.11 after the retailer reported fourth-quarter results that were lower than expected and gave a disappointing forecast.

In the bond market, interest rates edged up slightly. The price of the Treasury’s 10-year note slid 3/32, to 99 15/32, while its yield rose to 2.06 percent, from 2.05 percent late Friday.

Article source: http://www.nytimes.com/2013/03/12/business/economy/daily-stock-market-activity.html?partner=rss&emc=rss

Filed Under: Economy News Tagged With: , ,

U.S. Consumer Spending Rise Is Slim

December 23, 2011 by Leave a Comment

WASHINGTON (Reuters) — Consumer spending in the United States rose less than expected in November as tepid income growth put a squeeze on households, according to a government report on Friday that suggested slowing momentum in demand.

A separate report showed that new orders for manufactured goods soared in November on strong demand for aircraft, but a gauge of business spending plans fell for a second month, suggesting a cooling in investment. The Commerce Department said consumer spending ticked up 0.1 percent after rising by the same margin in October.

Economists polled by Reuters had expected spending, which accounts for two-thirds of the nation’s economic activity, to rise 0.3 percent last month.

When adjusted for inflation, spending rose 0.2 percent last month after a similar gain in October. The government on Thursday revised downward third-quarter consumer spending growth to a 1.7 percent annual pace, from 2.3 percent, because of a slump in spending at hospitals.

November’s anemic consumer spending is unlikely to change views that economic growth in the fourth quarter could top a 3 percent pace, accelerating from the July-September period’s 1.8 percent rate.

Income ticked up 0.1 percent last month, the weakest reading since August, after increasing 0.4 percent in October. Last month’s increase was below economists’ expectations for a 0.2 percent rise.

Taking inflation into account, disposable income was flat after rising 0.3 percent in October.

The saving rate dipped to 3.5 percent last month from 3.6 percent in October. Savings slowed to an annual rate of $400.9 billion from $419.1 billion the prior month.

The report showed subsiding inflation pressures, which should help to support spending.

The Personal Consumption Expenditures index, a price index for personal spending, was flat last month after falling 0.1 percent in October. In the 12 months through November, the P.C.E. index was up 2.5 percent, the smallest rise since April. That followed a 2.7 percent increase in October.

A core inflation measure, which strips out food and energy costs, edged up 0.1 percent last month after a similar gain in October. In the 12 months through November, the core index rose 1.7 percent after increasing 1.7 percent in September.

The Federal Reserve would like this measure close to 2 percent.

The Commerce Department’s report on durable goods, meanwhile, showed that orders jumped 3.8 percent after being flat in October. Economists had forecast orders rising 2 percent from a previously reported 0.5 percent fall.

Durable goods range from toasters to big-ticket items, like aircraft, that are meant to last three years or more.

Excluding transportation, orders rose 0.3 percent after rising 1.5 percent in October. Non-defense capital goods orders excluding aircraft, a closely watched proxy for business spending, fell 1.2 percent.

The category had dropped 0.9 percent in October. Economists’ had expected a 1.0 percent gain last month.

Business spending, which has helped the economy to recover from the 2007-09 recession, is slowing, but analysts still expect corporations holding about $2 trillion in cash to continue investing in capital.

Orders for durable goods last month were buoyed by a 14.7 percent increase in bookings for transportation equipment, as orders for civilian aircraft surged 73.3 percent.

Boeing received 96 orders for aircraft, according to the plane maker’s Web site, up from 7 in October.

Orders for motor vehicles, however, fell 0.5 percent after rising 5.9 percent the prior month.

Outside transportation, details of the report were mixed, with machinery orders rising, but demand for computers and related products falling.

The decline in orders for motor vehicles, computers and electrical equipment could be related to supply chain disruptions following flooding in Thailand.

Shipments of nondefense capital goods orders excluding aircraft, which go into the calculation of gross domestic product, fell 1.0 percent after declining 0.8 percent in October.

Article source: http://feeds.nytimes.com/click.phdo?i=d9615702096ce9ec77bc01aa03f1e2a5

Filed Under: Business News Tagged With: , ,

Retail Sales Rise, but Below Forecasts

June 3, 2011 by Leave a Comment

Sales at discount stores increased 7.8 percent in May, the best showing by any group of retailers in terms of sales last month, according to a survey of 25 retailers released on Thursday.

But sales at stores that have been open at least a year, known as same-store sales, compiled by Thomson Reuters, rose 4.9 percent in May, slightly below the 5.4 percent that analysts had forecast. It was also below the 8.9 percent growth in April, which was one of the biggest increases in the index in the last few years.

Analysts said the May figures reflected the continued pressures on consumers from an uncertain jobs market, a depressed housing sector and the recent rise in gasoline prices.

Sherif Mityas, a partner in the retail practice at A. T. Kearney, a global management consulting firm, called the results “a bit underwhelming.”

He added: “In totality we are still seeing significant headwinds from a consumer confidence perspective,” he said. “You are seeing that show up in consumer retail sales.”

The monthly survey of same-store sales is used as a gauge for buoyancy in the retail sector and the strength of consumers. It was released a day before the Labor Department’s monthly report on the jobs market. Analysts are forecasting an unemployment rate of 8.9 percent, down from 9 percent, and the addition of 170,000 jobs in May, although other jobs data this week has raised some concerns about whether those expectations will be met.

Economists said higher food and gasoline prices, although they have been moderating recently, have taken their toll on retailers. With some people out of work and a depressed housing market, “people are feeling less confident about where their money is going,” Mr. Mityas said.

“The American consumer is still unfortunately focused on their needs when they open their wallet,” he said.

Still, the Thomson Reuters survey also suggested that while discount consumers were seeking bargains, more affluent consumers were feeling less of a pinch. Retail sales at department stores rose 3.8 percent, but that was below the 4.5 percent increase expected. Apparel for teenagers did well, climbing 4.5 percent, slightly above expectations of 4.2 percent.

Another survey, from the International Council of Shopping Centers, released on Thursday found a gain of 5.4 percent in May retail sales from May 2010.

Neither survey includes Wal-Mart.

Chris G. Christopher Jr., the senior principal economist for IHS Global Insight, said: “The fact that luxury stores are plowing ahead gives some credence to suspicions that the high-end American consumer is pulling out of the recession relatively well, while the rest are having their incomes swallowed up by higher food and gasoline prices.

“In addition, shoppers are increasingly shopping for clothing from discount stores and staying away from the more expensive apparel outlets,” he said.

The Thomson Reuters survey accounts for sales in the four weeks through May 28. It quoted some retailers as saying that unseasonably cool and wet weather in the beginning of the month hurt traffic, but as the weather turned warmer near the end of the month, business picked up.

Same-store sales at Saks jumped 20.2 percent in May. In a statement, Saks said that a four-day sales event helped push up May’s results.

Costco was also strong, with a 13 percent rise.

Macy’s reported same-store sales were up 7.4 percent. The department store chain said in a statement that it was raising its guidance to a 5 percent increase in same-store sales for the second quarter from the previous estimate of about 4 percent.

Macy’s includes online sales in its same-store sales calculations.

Mr. Mityas said Saks and Macy’s were pursuing consumers with better pricing and merchandising. “They are clearly setting the bar,” he said.

Nordstrom said sales were up 7.4 percent.

Among the companies that missed forecasts by the biggest margins were Destination Maternity, which showed same-store sales declining 8.6 percent, worse than the decline of 1 percent forecast by analysts.

Same-store sales at J. C. Penney, which had been expected to show a 3.3 percent rise, fell 1 percent.

Gap and Stage Store also fell short of forecasts.

The teenage apparel retailers Buckle and Zumiez beat expectations, with same-store sales rising 8.8 percent and 7.8 percent, respectively, in May.

Article source: http://feeds.nytimes.com/click.phdo?i=b2e2aa0c156916828ae17bb57eb3f74e

Filed Under: Economy News Tagged With: , ,