US: Downside surprise in ISM manufacturing index – TDS

Analysts at TD Securities note that the US ISM manufacturing index surprised modestly to the downside, dropping to a still firm 53.9 level in November from 54.7 before (TD & market: 54.5).

Key Quotes

“Most of the decline reflected a significant drop in the business activity component, which fell 5pt to 51.6 —its lowest level since 2010. That said, a notable jump in new orders to 57.1 from 53.7 suggests the decline in business activity is likely to be short-lived.”

“The employment component was the other notable highlight in the report, with the index advancing to a four-month high 55.5. All in, despite the drop in the headline, the index remains at still firm levels consistent with economic activity chugging along and some of the key details are encouraging for the near horizon.”