US: ISM Manufacturing and initial jobless claims in the limelight - Nomura

Research Team at Nomura, suggests that the ISM Manufacturing and initial jobless claims are going to draw investors’ attention amongst a slew of other economic releases.

Key Quotes

“ISM manufacturing: The ISM manufacturing survey recorded a slight improvement in October, inching up to 51.9 from 51.5 in September. The details also showed healthy activity in the manufacturing sector. The ISM-adjusted regional data for November suggest that manufacturing activity continued to improve in November. Therefore, we forecast that the ISM manufacturing index improved slightly to 52.5 in November from 51.9 in October (Consensus: 52.5).”

“Initial jobless claims: Initial jobless claims rebounded back to trend in the week ending 19 November to 251k following a sharp decline to 233k in the prior week, the lowest in over 40 years. In that sense, the increase back to previous trend does not seem to suggest that labor market conditions are deteriorating. But a persistent increase could be an early warning that the economy is slowing.”

“Construction spending: Construction activity continued to slow in September as construction spending fell 0.4% m-o-m following a revised -0.5% in the prior month (previously reported as -0.7%). Both private residential and nonresidential construction spending fell 0.2% and 0.9% m-o-m, respectively, after a modest slowdown in August. However, the drag in residential construction activity may prove temporary. The NAHB home builder sentiment index remained elevated through Q3 and housing fundamentals call for better housing construction. Overall, consensus is looking for a 0.6% m-o-m increase in total construction spending in October.”

“Vehicle sales: Total vehicle sales beat market expectations in October, coming in at 17.9mn SAAR and implying that the pace of sales increased from September. Industry estimates suggest a modest slowdown in November but still an elevated pace of sales compared to earlier in the year. Therefore, we forecast 17.7mn SAAR total vehicle sales (Consensus: 17.7mn) and 13.9mn SAAR domestic vehicle sales (Consensus: 14.0mn) in November.”