DOW RALLIES AND AMERICAN MANUFACTURING IS GROWING AGAIN: Here's What You Need To Know

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Photo: National Archives

October and the fourth quarter kicked off with a ton of economic news.First the scoreboard:

Dow: 13,515, +77.9, +0.5%
S&P 500: 1,444, +3.8, +0.2%
NASDAQ: 3,113, -2.7, -0.0%

And now the top stories:

  • We got the September manufacturing PMI reports for all of the major economies around the world earlier today and over the weekend.  For the most part, manufacturing activity continues to shrink around the world, but less so than in the previous month. Here Are 13 Ugly Charts We’ve Seen In Just The Last 24 Hours >
  • China’s official manufacturing PMI number unexpectedly signaled contraction again. The index came in at 49.8, which was below economists’ expectation for it to climb to 50.1.  This was, however, a slight improvement from 49.2 in August. On Friday, we learned that China’s HSBC PMI climbed to 47.9 in September from 47.6 in August.  This was the eleventh straight sub-50 reading, which signals contraction in the industry. New export orders fell at the fastest rate in 42 months.  China is the second largest economy in the world.
  • The most shocking PMI report certainly came out of France, where the index plunged to 42.7 from 46.0 in August. We’re getting closer to a real freakout about France.  And Now Let Us Gasp In Horror At The Dismal Economic Situation In Spain >
  • If there was one thing that provided a jolt to the global markets today, it was the September ISM Manufacturing index, which jumped to 51.5 from 49.6 last month.  The number was also well ahead of economists’ consensus expectations of 49.7.  Any reading above 50 signals expansion in the industry.
  • So the story of the markets is that stocks continue to trend higher even as the the slowing economy hurts the outlook for corporate profits. And this has the bears mind-boggled. MORGAN STANLEY: These 42 Stocks Are Winners No Matter What Happens In The Economy >
  • One big winner today was Goldman Sachs, which got a bullish write up in the new issue of Barron’s. “Based on the likely outlook for capital-markets activity and Goldman’s ability to continue growing its book value, it is easy to conclude that the shares could rise at least 25 per cent within a year,” wrote Barron’s Michael Santoli.
  • Don’t Miss: An Excellent Presentation On Where The Economy And Markets Are Right Now >

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