The stock market looked like it might go up today with a deal on the debt ceiling near.
But stocks are lower this morning after we got some economic data. The manufacturing number (ISM) was expected (why do they even try to handicap this?) to be 54.9, down from June’s 55.3. Instead, it plunged to 50.9 – the lowest in two years. The dividing number, that which separates growth and contraction, is 50.
With that and the terrible GDP, who can doubt we’re double dipping in recession or never really got out of it?
Worse, the situation around the globe seems to be sinking, too. Europe and China had bad numbers, pointing towards a collapse in manufacturing. In the Eurozone it fell from 52 to 50.4; in China 50.7 from 50.9. Business surveys show the weakest rates of growth since 2009. Japan saw car sales plunge in July. Toyota fell 37% and Honda 33%.
Italy is going south with banks halted today. They’ll be needing a bailout and joining Greece, Spain, Ireland and Portugal. A big UK banking giant, HSBC, just announced they’re slashing 30,000 jobs.
What was that about a Summer of Recovery?