January Sees Improvement in ISM Manufacturing PMI to 49.1

The report showed that the manufacturing sector experienced a 15th consecutive month of economic contraction.\

Highlights

• ISM Manufacturing PMI rose from 47.4 in December to 49.1 in January.

• S&P Global Manufacturing PMI increased from 47.9 to 50.7.

• The SP500 rallied towards 4870 as traders responded to the reports.  

On February 1, 2024, the Institute for Supply Management published its ISM Manufacturing PMI report, revealing an improvement from 47.4 in December to 49.1 in January, surpassing the analyst consensus of 47. A reading below 50 signifies a contraction, signifying that the manufacturing sector experienced its 15th consecutive month of economic contraction.

According to the Institute for Supply Management, "Demand remains subdued but displays signs of improvement, and production execution remains steady compared to December, with panelists' companies continuing to manage outputs, material inputs, and labor costs."

Additionally, traders had the opportunity to review the final reading of the S&P Global Manufacturing PMI report for January, which indicated an increase from 47.9 in December to 50.7 in January, surpassing the analyst consensus of 47.2.

After the release of the PMI reports, the U.S. Dollar Index settled near the 103.50 level. Traders are digesting Powell's comments, with the impact of the better-than-expected PMI data on the American currency yet to be determined.

Gold is striving to maintain levels above $2050, with the recent decline in Treasury yields providing substantial support to the precious metals markets.

In response to the PMI data, the SP500 made an effort to settle above the 4870 level. From a technical perspective, the SP500 is endeavoring to recover following yesterday's sell-off.