Economic Report: Empire State index softens in April as trade concerns da…

Bloomberg News

Ganase Maharaj applies a satin finish to a nickel plated bath fixture inside the Watermark Designs manufacturing facility in Brooklyn, New York.

The numbers: The Empire State manufacturing index gave up most of the gains in April that it saw in the prior month, the New York Fed said Monday. The index slipped to a reading of 15.8 in April from 22.5 in March. The index is slightly above the 13.1 reading seen in February. The 6-month outlook fell 26 points to 18.3, its lowest level in two years.

What happened: The new-orders index eased 7.8 points to 9 in April and the shipments index fell 9.5 points to 17.5. On the employment side, the number of employees lost 3.4 points to 6 while the average workweek jumped 11 points to 16.9. The price indexs both moderated slightly.

The big picture: Manufacturing has been holding up well but all the talk of trade tariffs may be impacting the outlook. The longer-run outlook had its biggest drop since the financial crisis.

What are they saying:? “ The decline [in the six-month outlook] is coincident with concerns around trade wars and increased tariffs [and] should put us on high alert for further deterioration in business sentiment,” said T.J. Connelly, head of research at Contingent Macro Advisors.

Market reaction: Stocks DJIA, +0.61%  opened higher on Monday as attention was focused on corporate earnings.

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