ISM Manufacturing Index fell sharply in May to 53.5 from 60.4 in April, the lowest level in the past 12 months and below the decline to 57.1 that was forecast. However the index remains above the 50 level that denotes expansion, and indicates the overall economy continues to grow. The decline came as new orders fell to 51.0 from 61.7, production decreased to 54.0 from 63.8, and employment fell to 58.2 from 62.7. While the prices paid component fell to 76.5 from 85.5, below the 81.5 forecast, the Committee that compiles the survey said that manufacturers continue to experience “significant cost pressures from commodities and other inputs.”
The ADP Employment Change Report showed private sector payrolls rose by 38,000 jobs in May, versus the forecast of economists surveyed by Bloomberg, which called for a 175,000 increase, and April’s 179,000 job gain was revised to a rise of 177,000 jobs.
Construction spending rose more than expected in April, rising 0.4% month-over-month, versus the 0.3% increase forecast by economists, but March’s initially reported increase of 1.4% was revised to a 0.1% gain. Residential spending led the advance, increasing 3.1%, more than offsetting a 0.8% decline in nonresidential spending.
The Dow Jones Industrial Average plunged 280 points (2.2%) to 12,290, the S&P 500 Index fell 31 points (2.3%) to 1,315, and the Nasdaq Composite declined 66 points (2.3%) to 2,769. WTI crude oil fell $2.53 to $100.17 per barrel, while the Bloomberg gold spot price rose $2.42 to $1,538.15 per ounce.
