US manufacturing shrinks in November to 3-year low
Tuesday, December 4, 2012
WASHINGTON (AP) — U.S. manufacturing shrank in November to its weakest level since July 2009, one month after the Great Recession ended. Worries about automatic tax increases in the New Year cut demand for factory orders and manufacturing jobs.
The Institute for Supply Management said Monday that its index of manufacturing conditions fell to a reading of 49.5. That’s down from 51.7 in October.
Readings above 50 signal growth, while readings below indicate contraction. Manufacturing grew in October for only the second time since May. The ISM is a trade group of purchasing managers.
A gauge of new orders dropped to its lowest level since August, a sign that production could slow in the coming months. Manufacturers also sharply reduced their stockpiles, indicating companies expect weaker demand.
The report sent stocks lower. The Dow Jones industrial average fell 59.98 points to close at 12,965.60.
The Standard and Poor’s 500 dropped 6.72 points to 1,409.46. The Nasdaq composite was down 8.04 points to 3,002.20