Gains in the ISM gauge beginning in June signaled growing confidence among factory purchasing managers and foreshadowed a rebound in durable goods demand. Commerce Department data on Dec. 24 showed orders for non-military capital equipment excluding aircraft, a proxy for future business investment in long-lasting goods such as computers and machinery, climbed in November by the most in 10 months.
The gain in business equipment bookings helped drive a 3.5% increase in orders for all durable goods.
Manufacturers are also benefiting from the housing recovery. New-home sales ran at a 464,000 annual rate in November after a 474,000 pace in October that was the fastest since July 2008.
Worthington Industries Inc., a Columbus, Ohio-based steel company, reported steel-processing shipments jumped 31% in its fiscal second quarter ended Nov. 30 compared with a year earlier, while revenue for the unit rose 43%.
“Contracts, orders and shipments have increased significantly in several of our most important market segments including automotive, agriculture, and construction,” Mark Russell, president and chief operating officer, said on a Dec. 19 earnings conference call with analysts.
Among recently reported regional indexes, the MNI Chicago Report showed business activity grew in December, capping the strongest three months in more than two years. The Federal Reserve Bank of New York’s general economic index for the region rose to 0.98 in December after contracting the prior month.