Agricultural Machinery
Investment in Agricultural Machinery decreased 13% (annualized) in Q2 2024 and is roughly in line (+0.1%) with its year-ago level. The Agriculture Momentum Index ticked down from 115.0 to 113.3 in August. In June, corn futures fell 1.2% month-over-month while industrial production for farm machinery fell 2.3%. Despite the modest decline, the Index’s current position and previous movement suggests that annual growth in agriculture machinery investment should improve over the next two quarters.
Construction Machinery
Investment in Construction Machinery ticked down 1.7% (annualized) in Q2 2024 and is down 0.4% from its year-ago level. The Construction Momentum Index decreased for the fourth consecutive month to 95.3, down from 99.1 in July. In July, the University of Michigan’s Consumer Sentiment Survey fell 4.9% M/M while overtime hours for durable goods manufacturing fell 19%. Overall, the Index continues to point to a contraction in annual investment growth in construction machinery over the next two quarters.
Materials Handling Equipment
Investment in Materials Handling Equipment decreased 6.4% (annualized) in Q2 2024 but is 1.1% above year-ago levels. The Materials Handling Momentum Index increased from 84.4 in July to 85.7 in August. Manufacturing payrolls ticked down slightly in July, while prices for material handling equipment ticked up 0.3% M/M in June. Overall, the Index’s recent movement suggests that annual investment growth in materials handling equipment will remain weak and could turn negative over the next six months.
Other Industrial Equipment
Investment in All Other Industrial Equipment ticked down 1.3% (annualized) in Q2 2024 but is slightly above year-ago levels (+0.6%). The Other Industrial Equipment Momentum Index decreased from 94.3 in July to 92.7 in August. In June, machinery prices were up slightly (+0.3% Y/Y), while the industrial production price index increased 0.6% compared to its May reading. Overall, the Index’s position and recent movement suggest that annual investment growth in other industrial equipment may begin to improve over the next six months.
Medical Equipment
Investment in Medical Equipment increased 1.3% (annualized) in Q2 2024 and is up 1.2% on a Y/Y basis. The Medical Equipment Momentum Index increased from 94.0 to 95.5 in August. In June, the CPI for physicians’ services was up 0.8% Y/Y while industrial production of medical equipment and supplies declined 3.1% Y/Y. Overall, the Index’s sharp decline in recent months indicates that medical equipment investment growth will weaken and may turn negative over the next six months.
Mining & Oilfield Machinery
Investment in Mining & Oilfield Machinery increased 7.8% (annualized) in Q2 2024 and is down 5.1% from year-ago levels. The Mining & Oilfield Machinery Momentum Index increased from 87.6 to 89.3 in August. Crude oil production rose 2.9% M/M in May, while coal mining increased up 9.7% in June. Overall, despite the positive movement this month, the Index continues to point to negative annual growth in mining & oilfield machinery investment over the next six months.
Aircraft
Investment in Aircraft rocketed up at a 448% (annualized) rate in Q2 2024 and is up 7.0% on an annual basis. The Aircraft Momentum Index increased from 102.4 to 104.0 in August. The ISM PMI New Orders index decreased 12.6% M/M in June, while prices for aerospace and miscellaneous transportation equipment increased 1.3% M/M. Overall, recent movement in the Index suggests that annual growth in aircraft investment should improve over the next two quarters.
Ships & Boats
Investment in Ships & Boats fell at a 20% annualized rate in Q2 2024 and is 22% below its year-ago level. The Ships & Boats Momentum Index increased from 98.4 to 101.6 in August. In June, industrial production for ships and boats increased 2.8% Y/Y, while container trade in the Port of Long Beach jumped 21% M/M. Overall, the Index’s current position suggests that annual growth in ships & boats investment has bottomed out and should improve over the next six months.
Railroad Equipment
Investment in Railroad Equipment decreased 66% (annualized) in Q2 2024 and is down 5.9% year-over-year. The Railroad Equipment Momentum Index decreased from 93.7 to 89.0 in August. In July, rail carloads of food excluding grain decreased 0.1% M/M while the unemployment rate increased to 4.3%. Overall, the Index points to a worsening in annual railroad equipment investment growth over the next six months.
Trucks
Investment in Trucks increased 18% (annualized) in Q2 2024 and is 2.1% below year-ago levels. The Trucks Momentum Index held steady at 101.6 in August. In May, barrels of diesel oil per day increased 6.3% M/M, while industrial production for light trucks rose 6.4% in June. Overall, the Index indicates that annual investment growth in trucks may improve over the next six months.
Computers
Investment in Computers increased 21% (annualized) in Q2 2024 and is up 15% on a year-over-year basis. The Computers Momentum Index ticked down from 105.1 to 104.2 in August. In June, the ISM supplier deliveries index was 52.2 (solidly in expansion territory) while overall industrial production increased 0.6% M/M. Overall, the Index’s current position and recent movement point to continued strong annual investment growth in computers over the next six months.
Software
Investment in Software rose 6.6% (annualized) in Q2 2024 and is up 9.0% from a year prior. The Software Momentum Index ticked up from 92.2 to 93.0 in August. In June, average weekly earnings for computer and software merchant wholesalers rose 4.7% while industrial production increased 0.6%. Overall, the Index points to solid annual growth in software investment over the next two quarters.
