Kyle Tetting

Steve Giles

Tom Pappenfus

(with Max Hoelzl, Joel Dresang, engineered by Jason Scuglik)

No significant releases

Manufacturing continued its slump in September, according to the Institute for Supply Management’s manufacturing index. The index signaled contraction for the sixth month in a row and the 22^nd time in 23 months. At the same time, the measure suggested the U.S. economy overall expanded for the 53^rd consecutive month. Purchasing managers surveyed by the trade group said demand for manufactured goods was down and that companies were unwilling to invest in capital and inventory because of concerns over Federal Reserve policies and election uncertainty.

The Commerce Department said the annual rate of construction spending declined slightly in August for the third month in a row, though it was 4% ahead of the year-ago pace. Residential expenditures, which accounted for 42% of total spending, also slowed from August and were up 3% from the year before. Government spending on construction rose both for the month and compared to August 2023.

Employers expanded job openings in August for the first time in four months. According to the Bureau of Labor Statistics, the number of help-wanted posts rose more than 4% to 8 million openings. Demand for employees has slid from an all-time high of 12 million openings in March 2022 but remains above the pre-pandemic level of 7 million. Data showed little change in the numbers of hires or separations. The rate of employees quitting their jobs – a sign of worker confidence – was below the  February 2020 level for the 10^th month in a row.

No significant releases

The four-week moving average for initial unemployment claims fell for the third week in a row and the seventh time in eight weeks, employers remained relatively reluctant to part with workers. Data from the Labor Department showed average new applications for jobless benefits were 38% below the 57-year average and at the lowest level in four months. More than 1.6 million Americans were receiving unemployment benefits in the latest week, down 2% from the week before and up 2% from the same time in 2023.

Orders for factory goods fell in August for the third time in four months, the Commerce Department reported. Manufacturing orders shrank 0.2% from July and were up only 0.3% from the year before. Declines were led by a drop in orders for commercial aircraft. Excluding volatile orders for transportation equipment, demand fell 0.1% from July and rose 1.6% year to year. Core capital goods orders, a proxy for business investments, rose 0.3% both for the month and from the year before.

The U.S. services sector expanded in September for the third month in a row and at the fastest pace since in 19 months, according to the Institute for Supply Management. The trade group’s services index showed stronger business activity and new orders, which offset mixed results in hiring and supplies. The trade group said that based on past data, the index suggested the entire U.S. economy was growing at a 1.9% annual pace. Supply managers said they welcomed Fed rate cuts but had concerns about labor costs and political uncertainty.

Employers added 254,000 jobs in September, above the 12-month average of 203,000 and the 45^th consecutive month of gains. The Bureau of Labor Statistics reported broad increases in payroll jobs, with notable additions by the construction industry and bars and restaurants. Temporary help, sometimes a harbinger of wider hiring trends, was down 16% from its peak in early 2022 and stayed below the pre-pandemic level for the 12th month in a row. Average hourly wages rose 4% from the year before, continuing to outpace overall inflation. A separate household survey showed the unemployment rate at 4.1% in September, down slightly from August.

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• Nasdaq – 18138, up 18 points or 0.1%
  
• Standard & Poor’s 500 – 5751, up 13 points or 0.2%
  
• Dow Jones Industrial – 42353, up 23 points or 0.1%
  
• 10-year U.S. Treasury Note – 3.98%, up 0.23 point