ISM Release Kills Debt Agreement Rally

By on August 1, 2011

The Dow was sporting a 133 point gain until the Institute for Supply Management (ISM), a trade group of purchasing executives, said its index of manufacturing activity fell to 50.9 percent in July from 55.3 percent in June.  The reading was the lowest since July 2009.  ISM levels above 50 indicate growth in the economy.  A consensus of economists had expected a reading of 54.9.

The index fell in May to 53.5 from April’s reading of 60.4. That was the sharpest one-month drop since 1984.

Barron Maestro: The economy looks like its on the verge of a double dip recession.

The S&P 500 is holding above its low hit in June, but stocks hitting new lows are expanding.  There were over 170 NYSE stocks that hit a new 52 week low on Friday.  Many companies linked to economic performance are breaking down.

This is not a good development for the bullish camp.

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