WASHINGTON (AP) — American manufacturing slid last month for the first time since December, dragged down by economic fallout from the coronavirus outbreak.
The Institute for Supply Management, an association of purchasing managers, reported Wednesday that its manufacturing index fell to 49.1 in March after registering 50.1 in February. Any reading below 50 signals a contraction. The index had signaled growth in January and February.
Economists had expected a bigger drop in the index. Timothy Fiore, chair of ISM manufacturing index committee, said that “things got worse’’ as March dragged on and predicted that the index will signal more weakness in April. New orders and factory employment fell last month to the lowest level since the recession year 2009. Production and export orders also fell.
The COVID-19 pandemic and the quarantines, travel restrictions and business closings imposed to combat it have hammered global manufacturers, disrupting their access to supplies and crushing demand for their products. Manufacturers in Europe have also been hit hard.
But the impact of the outbreak is falling even harder on service businesses such as restaurants and hotels.
“Manufacturing is not, for the most part, in the very front line of the virus hit, but nonetheless large swathes of the sector are vulnerable as consumers cut back on spending on goods, especially big-ticket items like cars and trucks," Ian Shephardson, chief economist at Pantheon Macroeconomics, wrote in a research report, adding that “while this headline ISM reading is a pleasant-looking surprise, don’t be fooled.''
Ten of 18 industries surveyed reported growth in March, but six contracted, led by energy companies, coal producers and textile mills.
Already weakened by President Donald Trump's trade war with China, manufacturers around the world are reeling from COVID-19 and its economic impact. Also Wednesday, J.P. Morgan reported that its manufacturing index for the 19 European countries that share the euro currency dropped last month to the lowest level in nearly eight years. Confidence among eurozone manufacturers fell to a record low.
Best Growth Stocks - Best Stocks to Buy Now
The stock market has been growing since the New York Stock Exchange opened its doors in 1817. Sometimes, a stock will outpace the rest of the market in terms of growth. These skyrocketing securities—or the ones that analysts expect to skyrocket—are called growth stocks.
What Every Investor Needs to Know About Growth Stocks
Growth stocks are a great opportunity for an investor to make money in the stock market, but you’ve got to know what you’re going to buy or sell. A good understanding of growth stocks will help you get there.
At the beginning of a bull market, you can almost choose stocks randomly and find yourself a winner. Now that we are entering the ninth year of the current bull market, growth stocks have appreciated considerably and it's becoming far more challenging to find stocks with real opportunities for appreciation.
Growth companies are still largely outperforming their value counterparts in the United States and the rest of the world largely because of low interest rates, improved corporate earnings and global economic growth. Over the last five years, the S&P 500 Growth Index has returned 14.22% per year. During the same time, the S&P 500 Value Index returned just 12.94%.
Now that the bull market is now nearly a decade old, stocks have become very expensive. Value investors are largely sitting on the sidelines and growth investors are having a hard time figuring out where the remaining growth opportunities exist.
If you are looking for growth stocks in an increasingly small field, we have identified the 10 best growth stocks to buy right now based on their expected earnings growth over the next several years. These companies are all growing rapidly and will likely see double-digit earnings growth next year.
View the "Best Growth Stocks - Best Stocks to Buy Now".