The numbers: After rocketing into positive territory in August, the Philadelphia Fed said Thursday its gauge of regional business activity lost all of the improvement, falling back to negative 13.5 in September.
Any reading below zero indicates deteriorating conditions.
Economists polled by the Wall Street Journal expected flat reading in September.
This is the index’s 14 monthly negative reading in the past 16 months.
Key details: The new orders index dropped to negative 10.2 from 16 in August. The shipments index fell 9 points to negative 3.2.
Firms reported a decline in employment and an overall increase in prices.
The index of future activity rose to 11.1 in September from 3.9 in August.
Big picture: The Philadelphia Fed index is one of the first regional manufacturing gauges that offer timely reads of the manufacturing sector.
Earlier this week, the Empire State index showed manufacturing improved markedly in New York State. The general business conditions index rebounded 20.9 points to 1.9 in September.
The ISM factory index contracted in August for the ninth straight month, despite improving to 47.6% from 46.4% in the prior month.
“The factory portion of the economy is in a mild recession, but there is hope of a stabilization or small bounce by the end of the year if things go well,” said Stephen Stnley, chief economist at Santander US, in a note to clients last month.
Market reaction: Stocks
DJIA
SPX
were set to open lower on Thursday while the 10-year Treasury yield
BX:TMUBMUSD10Y
rose to 4.49%.
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