Published on 2 Apr 2024 on Zacks via Yahoo Finance

4 Manufacturing Stocks to Buy as the Sector Rebounds

The manufacturing sector in the United States has been badly hit by the Federal Reserve’s tight monetary policy regime, starting mid-2022. February marked the 16th straight month of the manufacturing PMI remaining under 50. This indicates a contraction in manufacturing. The sector has been constrained by higher borrowing costs. This run was the longest since the period from August 2000 to January 2002.

However, the Institute for Supply Management (“ISM”) said on Monday that the manufacturing PMI came in at 50.3 for March against a consensus of 48.6, increasing significantly from the February number, which was unrevised at 47.8. It is now finally in the expansion zone.

New orders sub-index increased to 51.4 in March from 49.2 in February. Factory output also rebounded big time, with the production sub-index surging to 54.6 from 48.4 in the month prior. There were no visible signs of supply chain issues arising from attacks on international shipping in the Red Sea by Houthi militants. Supplier deliveries for March came in at 49.9, down from 50.1 in February. A reading below 50 indicates faster deliveries.