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Business Title: US Wholesale Inventories Unexpectedly Fall 0.8% in Sign of Higher Demand Feb. 9 (Bloomberg) -- Inventories at U.S. wholesalers unexpectedly fell in December following the biggest increase in more than five years, indicating distributors had trouble keeping up with demand. The 0.8 percent decrease in stockpiles followed a revised 1.6 percent gain in November that was the largest since July 2004, figures from the Commerce Department showed today in Washington. Sales climbed 0.8 percent. A record inventory drawdown last year has opened the door for manufacturers to pick up production and other companies to increase orders to meet demand. Efforts to prevent stockpiles from falling further in the fourth-quarter provided its biggest boost to economic growth in 20 years and may keep supporting the economy in coming quarters. “The sales numbers are strong,” said David Sloan, a senior economist at 4Cast Inc., a New York forecasting firm. “If sales continue to rise, inventories are poised to be rebuilt.” Economists forecast inventories would rise 0.5 percent after a previously estimated 1.5 percent increase in November, according to the median of 31 projections in a Bloomberg News survey. Estimates ranged from a drop of 0.8 percent to a 1 percent gain. Job openings rose in December to 2.5 million from 2.43 million a month earlier, the first gain in three months, a report from the Labor Department also showed today. Manufacturers and retailers were among industries with the biggest increase in employment opportunities. Shares Rise Stocks maintained earlier gains after the reports on speculation that Greece will get European help with its budget deficit. The Standard & Poor’s 500 Index climbed 0.9 percent to 1,066.7 at 10:49 a.m. in New York. Treasury securities fell. At the current sales pace, it would take 1.12 months for wholesaler to deplete the amount of goods on hand, the lowest level since a record-low 1.11 reading in June 2008. Efforts to rebuild depleted inventories contributed 3.4 percent points to gross domestic product in the fourth quarter, the most in two decades. Private reports suggest stockpile rebuilding has continued to help boost production. The Institute for Supply Management’s factory index rose to 58.4 in January, the highest since August 2004, and the survey’s gauges of production and new orders rose. Machinery, Autos Inventories of durable goods, or those meant to last at least three years, decreased 1.1 percent in December, and sales increased 3 percent. Distributors of machinery, automobiles and metals led the drop in stockpiles as sales increased. Wholesalers make up about 30 percent of all business stockpiles. Factory inventories, which account for about 38 percent of the total, fell 0.1 percent in December, the Commerce Department said Feb. 4. Retail stockpiles make up the rest and will be included in the Feb. 11 business inventories report. Rockwell Automation Inc.’s profit fell in the fiscal first quarter less than anticipated and the company raised its 2010 forecast. Demand was strongest in the U.S., led by sales of software and orders from recovering industries including automakers, Chief Executive Officer Keith Nosbusch said in an interview Jan. 27. Companies “de-stocked to the point where any need had to be filled immediately, one to one, as opposed to before where they were able to take it out of their inventory supply chain,” Nosbusch said.
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#1. To: Brian S, badeye (#0)
Badeye will need a hug today. :-)
Not at all.
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