U.S. Averages

In the morning trading major averages have positive bias as nation’s industrial activity continues in the 26th month. The ISM manufacturing survey reported that the July PMI index came in at 56.6 indicating 2.8% jump from activity level in June.

Commerce Department reported slowing but still strong construction activity for the month of June. The June spending was 0.3% lower than revised level in May and 7.9% higher than a year ago.

Proctor & Gamble reported 4Q profit of 56 cents vs. 50 cents a year ago on 10% rise in sales. Humana reported 2Q profit of 51 cents vs. 50 cents a year ago and raised earnings guidance for 2006 and reaffirmed 2005 earnings.


Economic News

Construction Spending

The U.S. Census Bureau of the Department of Commerce announced today that construction spending during June 2005 was estimated at a seasonally adjusted annual rate of $1,093.0 billion, 0.3 percent below the revised May estimate of $1,096.0 billion. The June figure is 7.9 percent above the June 2004 estimate of $1,013.2 billion.

During the first 6 months of this year, construction spending amounted to $514.8 billion, 9.3 percent above the $471.0 billion for the same period in 2004.

Spending on private construction was at a seasonally adjusted annual rate of $843.8 billion, 0.2 percent below the revised May estimate of $845.6 billion. Residential construction was at a seasonally adjusted annual rate of $602.4 billion in June, 0.4 percent below the revised May estimate of $604.8 billion. Nonresidential construction was at a seasonally adjusted annual rate of $241.4 billion in June, 0.2 percent above the revised May estimate of $240.9 billion.

In June, the estimated seasonally adjusted annual rate of public construction spending was $249.2 billion, 0.5 percent below the revised May estimate of $250.3 billion. Educational construction was at a seasonally adjusted annual rate of $64.6 billion, 1.2 percent below the revised May estimate of $65.4 billion. Highway construction was at a seasonally adjusted annual rate of $67.0 billion, 0.4 percent below the revised May estimate of $67.3 billion.

ISM Manufacturing Survey

The Institute for Supply Management reported that the ISM Manufacturing Index PMI for July came in at 56.6 indicating that manufacturing activity has picked up in the last month.

The report was issued today by Norbert J. Ore, C.P.M., chair of the Institute for Supply Management Manufacturing Business Survey Committee. ""The manufacturing sector grew for the 26th consecutive month in July based on the ISM data. An improved rate of growth in New Orders and Production continues to drive improvement in the sector. It appears that the sector hit a low point in May, and has rebounded nicely in June and July. The Prices Index apparently reached the end of its run in June, as the July index indicates that pricing power, at least for the short term, is now once again favoring buyers.""

Earnings News

Harvest Natural Resources, the Houston oil and gas producer, posted 2Q earnings of 37 cents a share, up vs. 16 cents for the year-ago period on revenue growth.

Oregon Steel Mills, commodity steel products manufacturer, posted 2Q net income of 80 cents a share, up vs. 52 cents, gained last year the same period on strong sales, missing analyst forecasts by a penny.

Humana, health insurer, announced 2Q net profit was up to 51 cents a share on strong revenue growth, meeting analyst forecasts

HSBC, banking and related financial services group, annouced first-half pre-tax profit was up to 5.1%, following a 8.66% gain in North American pre-tax profits and 32.1% growth in Asian ex-Hong Kong profits on expanding personal financial services and commercial banking businesses in new and emerging markets.

ABN Amro, banking services group, reported 2Q net profit rise of 11% from a year 39.2% on growth in retail revenue and performance of structured derivatives, beating analysts expectations considerably, although the Dutch bank warned that second-half net profit will go down vs. the first half, on weker income from asset and liability management and increased provisions.

Teva, pharmaceuticals group, posted 2Q net income earnings per share rose up to 36 cents, compared with last year the same period on strong net sales and balanced business model.