Stock Market Update

[BRIEFING.COM] The major averages remain mixed, with relatively weak participation in the broader market.

The ISM Manufacturing Index hit 54.0% in May (Briefing.com consensus 53.1%), up from 52.7% in April. The dividing line between expansion and contraction is 50.0%, so the May figure suggests an acceleration in the rate of change in manufacturing activity compared to April.

The key takeaway from the report is that it continued showing some stagflationary elements for the second consecutive month, as employment remained in contraction—though at a slower rate—while the prices index only dipped slightly from its sharpest increase since early 2022.

Construction spending increased 0.4% month-over-month in April (Briefing.com consensus 0.3%) after increasing a revised 0.2% (from 0.6%) in March. On a year-over-year basis, construction spending was up 0.9%.

The key takeaway from the report is that it included a sharp downward revision to growth rate from March (0.2%), resulting in a weak report overall. New single-family construction spending increased a solid 1.4% in April but was still down 2.9% year-over-year.