The Jordan, Knauff & Company (JKC) Valve Stock Index was up 7.9 percent over the last 12 months, below the broader S&P 500 Index which was up 12.8 percent. The JKC Pump Stock Index continued its upward trend, ahead 30.9 percent for the same time period.
Manufacturing activity has slowed significantly in recent months. The Purchasing Managers Index fell to 50.6 in August, slightly above the threshold of 50 which signifies growth in the sector. In April, the PMI was indicating strong growth at 60.4. The report noted, “The overall sentiment is one of concern and caution over the domestic and international economic environment.” Of the 18 industries surveyed, 10 reported growth, including: wood products; petroleum and coal products; miscellaneous manufacturing; food, beverage and tobacco products; fabricated metal products; paper products; transportation equipment; chemical products; computer and electronic products; and machinery.
The Bureau of Labor Statistics reported no change in net employment between July and August. The unemployment rate remains at 9.1 percent. The private sector generated 17,000 new jobs, which were offset by a loss of 17,000 government workers. The manufacturing sector lost 3,000 workers, the first decline since October 2010.
The Conference Board Consumer Research Center reported that consumer confidence, which had improved slightly in July, deteriorated sharply in August. At 44.5, the index is at its lowest level in more than two years. A contributing factor may have been the debt ceiling discussions since the decline was well underway before the U.S. debt downgrade. The U.S. Energy Information Administration (EIA) lowered its projected pace of global oil demand due to less optimistic assumptions about global economic growth, relieving some of the potential oil market tightness projected in its previous forecasts. However, the EIA expects world crude oil and liquid fuels consumption will continue growing from record high levels in 2010. In the U.S, total consumption of liquid fuels grew 2.2 percent in 2010, the highest rate of growth since 2004. In contrast, U.S. consumption is projected to fall 0.9 percent in 2011 and then increase 0.4 percent, to 19.1 million barrels per day, in 2012.
The number of oil and gas rigs in operation worldwide increased in August to 3,613, slightly above peak levels from September 2008 and 15 percent higher than August 2010. In the U.S., rig counts increased by 19 percent over August 2010 levels to 1,957. West Texas Intermediate crude oil spot prices fell from an average of $97 per barrel in July to $86 per barrel in August.
Pumps & Systems, October 2011
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