Agricultural Machinery
Investment in Agricultural Machinery decreased 14% (annualized) in Q2 2024 but improved modestly (2.7%) on a year-over-year basis. The Agriculture Momentum Index fell from 109.7 in September to 107.1 in October. In July, while rice and other food and grains exports grew 10% M/M, unmanufactured tobacco exports fell 59% M/M. The Index’s current position and previous movement suggests that annual growth in agriculture machinery investment will continue to weaken over the next two quarters.
Construction Machinery
Investment in Construction Machinery ticked down 3.9% (annualized) in Q2 2024 and is 1.0% below its year-ago level. The Construction Momentum Index decreased from 97.2 to 93.5 in October. In August, new homes under construction ticked down 1.9%, while construction machinery shipments also decreased. Overall, the Index points to a continued contraction in annual investment growth in construction machinery over the next two quarters.
Materials Handling Equipment
Investment in Materials Handling Equipment decreased 4.1% (annualized) in Q2 2024 but is 2.1% above year-ago levels. The Materials Handling Momentum Index increased from 86.4 to 89.8 in October. Manufacturing payrolls ticked down slightly in September (-0.1%), but prices for material handling equipment rose 1.4% M/M in August. Overall, the Index’s recent movement suggests that annual investment growth in materials handling equipment may improve modestly over the next six months.
Other Industrial Equipment
Investment in All Other Industrial Equipment slipped 4.1% (annualized) in Q2 2024 and is essentially flat compared to year-ago levels (-0.3%). The Other Industrial Equipment Momentum Index increased from 91.9 to 93.5 in October. In August, the Industrial Production increased 0.8% while the Nominal Advanced Foreign Economies Index fell 2.4%. Overall, the Index’s continues to suggest that annual investment growth in other industrial equipment will remain muted over the next six months, though recent movement is encouraging.
Medical Equipment
Investment in Medical Equipment decreased 1.8% (annualized) in Q2 2024 and is down slightly (-0.5) on a Y/Y basis. The Medical Equipment Momentum Index held steady at 96.2 in October. In August, the CPI for medical care ticked down 0.1%, while the Medtronic Market Cap increased 1.6% in September. Overall, the Index’s downward trajectory in recent months points to modest growth in annual medical equipment investment over the next six months.
Mining & Oilfield Machinery
Investment in Mining & Oilfield Machinery increased 3.7% (annualized) in Q2 2024 but remains 9.2% below year-ago levels. The Mining & Oilfield Machinery Momentum Index increased from 91.7 to 94.2 in October. Payrolls for mining & logging increased in September, while oil & gas production increased 3.1% in July. Overall, the Index continues to point to weak or negative annual growth in mining & oilfield machinery investment over the next six months, but recent movement in the Index is encouraging.
Aircraft
Investment in Aircraft jumped 626% (annualized) rate in Q2 2024 and is up 1.0% on an annual basis. The Aircraft Momentum Index increased from 104.9 to 105.7 in October. The ISM New Orders Index increased 12% in September, while computer and electronic product exports increased 7.4% in July. Overall, recent movement in the Index suggests that annual growth in aircraft investment should continue to improve over the next two quarters.
Ships & Boats
Investment in Ships & Boats fell at a 17% annualized rate in Q2 2024 and is 19% below its year-ago level. The Ships & Boats Momentum Index slipped from 107.3 to 106.5 in October. Industrial production of ships and boats decreased 1.4% in August, while the ISM purchase managers’ index increased 6.6% in September. 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 increased 13.6% (annualized) in Q2 2024 and is up 25.9% year-over-year. The Railroad Equipment Momentum Index ticked up from 91.3 in September to 92.1 in October. In September, the price of Brent crude oil fell 25% Y/Y, while capacity utilization for manufacturing improved 6.3% M/M in August. Overall, while the Index has been trending downward in recent months, railroad equipment investment growth should remain positive on a year-over-year basis over the next six months.
Trucks
Investment in Trucks increased 5.2% (annualized) in Q2 2024 and is 1.5% above year-ago levels. The Trucks Momentum Index decreased from 96.0 in September to 92.0 in October. In August, capacity utilization for furniture and related products manufacturing improved 1.1% M/M while raw steel production decreased 2.2% M/M in September. Overall, the Index suggests that annual investment growth in trucks will remain soft and may turn negative over the next six months.
Computers
Investment in Computers increased 20% (annualized) in Q2 2024 and is up 16.6% on a year-over-year basis. The Computers Momentum Index increased from 104.2 to 105.9 in October. In August, the CPI for computer software and accessories rose 1.1% Y/Y, while new orders on computers and electronic products increased 2.8% Y/Y. 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 grew 2.3% (annualized) in Q2 2024 and is up 7.1% from a year prior. The Software Momentum Index jumped from 92.2 in September to 97.7 in October. In September, the ISM supplier deliveries index increased 5.0% M/M, while the unemployment rate eased 0.1 percentage point in September. Overall, the Index continues to indicate solid annual growth in software investment over the next two quarters.
