US: ISM Manufacturing Index to pull back slightly in November – Wells Fargo

Analysts at Wells Fargo are looking for the US ISM manufacturing index to pull back slightly in November to 58.4, after the index retreated slightly in October from its unusually strong September reading.

Key Quotes

“The supplier deliveries subcomponent is still providing an artificial boost to the index, and this effect is likely to fade further in the November reading.” 

“The underlying trend continues to be positive. The six-month averages for the production and new orders subcomponents are above 60, and the employment subcomponent has averaged a respectable 57.7 over the same period. The hard data have backed up the survey, with core capital goods orders rising at a 14.5 percent three-month average annualized rate through October.” 

“We look for the ISM manufacturing index to pull back slightly in November to 58.4. With encouraging fundamentals in place, we expect the slow but steady improvement in the U.S. factory sector to continue in the coming months.”