NY Fed Manufacturing Growth Slows Sharply in April
The pace of manufacturing growth in New York state slowed sharply in April to its lowest level in five months, the New York Federal Reserve said in a report on Monday.
The New York Fed's "Empire State" general business conditions index dropped to 6.56 from 20.21 in March, far below economists' expectations for 18.00. It was the lowest level since last November.
The survey of manufacturing plants in the state is one of the earliest monthly guideposts to U.S. factory conditions. After a rout last summer, manufacturing in New York had been improving steadily since last October.
Investors will get another look at the manufacturing sector with the Philadelphia Federal Reserve Bank business activity index on Thursday. The two surveys are watched for clues to the direction of the larger, national manufacturing figures, though the regional reports can be more volatile.
"Manufacturing was decidedly a negative surprise," said Wayne Kaufman, chief market analyst at John Thomas Financial in New York. If manufacturing slows down, that will certainly be a headwind to the economy."
Still, U.S. stock index futures gained as investors also took in a separate report that showed retail sales rose more than expected in March.
The dollar slightly extended gains against the euro, while Treasurys prices were steady at higher levels.
The Empire State survey's new orders index fared better but still cooled to 6.48, the lowest level since December, from 6.84, while shipments tumbled to 6.41 from 18.21.
Employment gauges were mixed. The index for the number of employees improved to its highest level since May at 19.28 from 13.58, but the average employee workweek index slid to 6.02 from 18.52.
The index of business conditions six months ahead was also at its lowest level since November at 43.12 from 47.50.