Building permits stumble in February. Privately-owned housing units authorized by building permits in February were at a seasonally adjusted annual rate of 1,167,000, 3.1% below the revised January rate of 1,204,000, but 6.3% above the February 2015 estimate of 1,098,000. Single-family authorizations in February were at a rate of 731,000, 0.4% above the revised January figure of 728,000.
Purchasing Managers Index shows nice increase in February but still sits in contraction territory. The Institute for Supply Management (ISM), Tempe, Ariz., reported that the February Purchasing Managers Index (PMI) registered 49.5%, an increase of 1.3 percentage points from the January reading of 48.2%.
Bullish year-to-date increase in transportation stocks point toward improving economic conditions. The Dow Jones Transportation Index (DJT), a leading indicator for the future direction of the stock market, is on a tear after dropping to a two-year low in early January. The index, a basket of 20 railroad, airline, trucking, freight and shipping stocks, is now up about 20% over its Jan. 20 low.
Stock analysts watch this index closely. A March 18 Wall Street Journal article on the Index said, “The transport average bottomed three weeks before the S&P 500 and has risen ahead of the major indexes as improving data on U.S. jobs, manufacturing and consumer spending has reassured investors that a recession isn’t pending.”
Architecture Billings Index creeps back into positive territory. The Architecture Billings Index saw a dip into negative terrain for the first time in five months in January, but inched back up in February with a small increase in demand for design services. As a leading economic indicator of construction activity, the ABI reflects the approximate nine- to twelve-month lead time between architecture billings and construction spending. The American Institute of Architects (AIA) reported the February ABI score was 50.3, up slightly from the mark of 49.6 in the previous month. This score reflects a minor increase in design services (any score above 50 indicates an increase in billings). The new projects inquiry index was 59.5, up from a reading of 55.3 the previous month.
