US manufacturing sector contracts for 12th month

By Ovunc Kutlu

ISTANBUL (AA) - The US manufacturing sector in October contracted for the 12th consecutive month, according to a report released Wednesday by the Institute for Supply Management (ISM).

The ISM manufacturing purchasing managers' index (PMI) came in at 46.7% last month -- 2.3 percentage points lower than the 49% recorded in September.

While a reading above 50 indicates growth, below that shows contraction.

The market expectation for the index, based on replies from purchasing and supply executives in more than 400 industrial firms, was to come in at 49%.

"The overall economy dropped back into contraction after one month of weak expansion preceded by nine months of contraction and a 30-month period of expansion before that," said Timothy Fiore, the chair of ISM Manufacturing Business Survey Committee.

The new orders index failed to leave the contraction zone in October, recording a 14th consecutive month in that territory, by coming in at 45.5% -- 3.7 percentage points lower than 49.2% in September.

The production index in October, on the other hand, posted a reading of 50.4%, a 2.1 percentage points decrease from September's figure of 52.5%.