It is ISM day-

Another negative print on the ISM.....

MANUFACTURING AT A GLANCE JULY 2012
Index	Series Index Jul	Series Index Jun	Percentage Point Change	Direction	Rate of Change	Trend* (Months)
PMI	49.8	49.7	+0.1	Contracting	Slower	2
New Orders	48.0	47.8	+0.2	Contracting	Slower	2
Production	51.3	51.0	+0.3	Growing	Faster	38
Employment	52.0	56.6	-4.6	Growing	Slower	34
Supplier Deliveries	48.7	48.9	-0.2	Faster	Faster	6
Inventories	49.0	44.0	+5.0	Contracting	Slower	4
Customers' Inventories	49.5	48.5	+1.0	Too Low	Slower	8
Prices	39.5	37.0	+2.5	Decreasing	Slower	3
Backlog of Orders	43.0	44.5	-1.5	Contracting	Faster	4
Exports	46.5	47.5	-1.0	Contracting	Faster	2
Imports	50.5	53.5	-3.0	Growing	Slower	8
OVERALL ECONOMY				Growing	Faster	38
Manufacturing Sector				Contracting	Slower	2

... and it is likely to stay that way. Although the PMI was essentially flat, as slightly higher new orders and production measures offset declines in employment, other and more forward looking measures look weak. The inventories measures suggests a contraction in inventories (which is a positive). However, the decline is slowing, and inventories may increase in future periods without slower production rates and/or an increase in new orders. Ominously, the order backlogs declined again to 43, suggesting a slow down in future production absent of a bump in new orders. As the latter is concerned, the customer inventories index ticked up to 49.5. This measure typically runs inverse to new orders and suggests weak new order prints in future periods. In addition, the exports figure declined once again, obviously showing the weakness in the world economy.