Companies in U.S. Expand by Most Since 2006 as Orders Increase

[Purveyor]

Source: Bloomberg



By Bob Willis

Dec. 30 (Bloomberg) -- Companies in the U.S. expanded in December at the fastest pace in almost four years, signaling the economic recovery is gaining speed heading into 2010.

The Institute for Supply Management-Chicago Inc. said today its business barometer rose to 60, exceeding the most optimistic estimate of economists surveyed by Bloomberg News and the highest level since January 2006. Readings above 50 signal expansion.

Stimulus programs and discounting have propelled a rebound in global sales that is reducing stockpiles, which may spur manufacturers to further increase production in coming months. Caterpillar Inc. is among companies that may recall dismissed staff, pointing to gains in employment that will give consumers the means to boost spending, which accounts for 70 percent of the economy.

“Manufacturing is now moving into recovery,” said David Sloan, senior economist at 4Cast Inc. in New York, whose estimate was the highest among economists surveyed. “Inventories are rebuilding and exports are looking strong, with the Asian economies looking firmer and the dollar weak.”

Stocks drifted between gains and losses as lower metal prices dragged down commodity producers, offsetting the rise in the business barometer. The Standard & Poor’s 500 Index was down 0.3 percent to 1,123.37 at 10:58 a.m. in New York.

Exceeds Estimates

Economists projected the Chicago index would drop to 55.1 from 56.1 in November, based on the median estimate of 53 projections in the Bloomberg survey. Forecasts ranged from 52 to 58.5.

Read more: http://www.bloomberg.com/apps/news?pid=20601087&sid=aq.eiBGooTdc&pos=1

[nradisic]

1. My business is up...

I own a small fine wine distributor in the Metro NY area and our business is up nicely in December vs. last year. It is the first time our sales are up since October 2008....we all need it to keep going as we head into 2010. I'll drink to that.

[MineralMan]

2. You'll want to hope that lots of people drink to that, eh?