Instant View: Construction, ISM data point to recovery

Reuters

NEW YORK (Reuters) - Construction spending rose more than expected in March, and a survey of factory activity in April increased, suggesting steady recovery in U.S. demand.

ISM:

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The pace of growth in the U.S. manufacturing sector slowed in April for a second straight month but input prices were at their highest in nearly three years, according to an industry report released on Monday.

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COMMENTS:

JAMES NEWMAN, HEAD OF TREASURY TRADING AND AGENCY TRADING, KEEFE, BRUYETTE, AND WOODS, NEW YORK

"It looks like good data, prices paid is a little bit higher that what they were looking for and the number itself is almost stronger by one-tenth. Its good data, the market is selling off a little bit but I wouldn't call it market moving."

DAVID SLOAN, ECONOMIST, IFR ECONOMICS, A UNIT OF THOMSON REUTERS:

"March's construction spending report with a 1.4% rise saw its first increase since November and its strongest rise since April 2010, comfortably exceeding a consensus for a 0.4% increase even with net revisions marginally negative. January's change was revised up by 0.8% to -1.0% from -1.8%, but February was revised down by 1.0% to -2.4% from -1.4%. The underlying construction picture is weak but the March rebound suggests a harsh winter exaggerated the 3 straight declines (now totaling 6.6%) that preceded it, with more favorable weather in March seeing those losses partially corrected."

MARKET REACTION: STOCKS: U.S. stock indexes tacked on gains BONDS: U.S. bond prices added losses FOREX: The dollar was little changed

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