Weak industrial production data from the US
US industrial production is dominated by companies like General Electric (GE), 3M (MMM), and United Technologies (UTX), among others. It hasn’t been able to pick up the desired pace. Also, weak industrial production data continue to disappoint investors in industrial sector tracking ETFs like the Industrial Select Sector SPDR ETF (XLI) and the SPDR Dow Jones Industrial Average ETF (DIA). XLI was down 0.84% and DIA lost 0.58% on June 15. The industrial production figures were way below market expectations.
Although the manufacturing sector in the US has come a long way from its recessionary lows, growth in the sector continues to stagger at its own pace. The Federal Reserve Board released the industrial production data for May on Monday, June 15.
The data indicated that industrial production edged down by 0.17% in May—compared to an expected 0.2% rise. So far, the industrial production index has declined in four out of five months this year. May’s dip of -0.17% was worse than April’s -0.5%.
Manufacturing slowed and capacity utilization edged down
In May, industrial production in the US was supported—to some extent—by a 0.2% gain in the utilities sector. The mining sector retracted by 0.3%. It dragged the headline growth down, along with the manufacturing sector decline.
Manufacturing slowed in May. It recorded a 0.2% dip from April’s readings. Manufacturing rose by 0.1% in April 2015. Both the industrial and manufacturing readings were worse than the market expectations. Overall, the capacity utilization stood at 78.1%—down from April’s reading of 78.3% and below the median expectations of 78.3%.
Although the US industrial sector didn’t have good news for its investors, there were some positive indicator readings from the Eurozone, while Russia continues to tackle its many woes.