As the calendar has turned into October, it is time once again to prepare for the cycle of earnings reports that will follow the end of the calendar third quarter. The third quarter was a rather strong period for the stock market, as the S&P 500 rose nearly 11%, even though there was a constant drumbeat of worry about the possibility of a double-dip recession.
Looking at the industrial supply market, there are reasons to be optimistic about the third quarter. Rail traffic continues to recover, which can be read in more detail in this article, suggesting that industrial activity is solid. Likewise, the recent ISM report highlights ongoing growth in the manufacturing sector, even if at a slower pace. In particular, 13 of the 18 reported industries showed growth in September, with the exceptions being wood products, printing and nonmetallic minerals contracting. While the slowing pace of orders, the growing level of inventory and the reversal of backlog are concerning indicators for the fourth quarter, the third quarter appears to have been a good one for manufacturers, and presumably the companies that supply them. (For more, check out Economic Indicators: Purchasing Managers Index.)
For the full article, please continue on to:
http://stocks.investopedia.com/stock-analysis/2010/Looking-Ahead-To-Industrial-Supplier-Earnings-AIT-GWW-FAST-WCC-CAT-CMI1008.aspx
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