Agricultural Machinery
Investment in Agricultural Machinery plunged 52% (annualized) in Q1 2023 and was down 26% from one year ago. The Agriculture Momentum Index dropped from 90.1 in April (revised) to 89.1 in May. The Crops Agricultural Price Index fell 1.5% and Agricultural Machinery Industrial Production fell 2.9% in March. Overall, the Index’s position and recent movement suggest that agriculture machinery investment growth is likely to weaken further over the coming six months.
Construction Machinery
Investment in Construction Machinery rose 15% (annualized) in Q1 2023 and was 23% above its year-ago level. The Construction Momentum Index edged down from 87.2 in April to 85.3 in May. Housing Starts in the Western U.S. fell 28% and Months Inventory of Existing Homes increased 12% in March. Overall, the Index’s position suggests that construction machinery investment growth may have peaked and could start to decelerate over the coming two quarters.
Materials Handling Equipment
Investment in Materials Handling Equipment fell 10% (annualized) in Q1 2023 and was 3.3% below year-ago levels. The Materials Handling Momentum Index dipped from 91.0 in April to 86.2 in May. In March, Durable Manufacturing Industrial Production declined 0.9% while Inventories of Durable Goods fell 0.2%. Overall, the Index’s recent movement and position suggest that materials handling equipment investment growth will likely remain weak over the coming three to six months.
Other Industrial Equipment
Investment in All Other Industrial Equipment increased at a 3.8% (annualized) rate in Q1 2023 but was down 3.3% Y/Y. The Other Industrial Equipment Momentum Index edged down from 94.1 in May (revised) to 93.3 in May. The Chicago Business Barometer Index rose 11% in April while Manufacturing Industrial Production dipped 0.5% in March. Overall, the Index’s position and recent movement suggest that other industrial equipment investment growth may have bottomed out and could see a modest improvement over the coming two quarters.
Medical Equipment
Investment in Medical Equipment collapsed 15% (annualized) in Q1 2023 and was down 1.3% year-over-year. The Medical Equipment Momentum Index fell from 94.5 in April (revised) to 92.9 in May. In March, Urban Consumer Hospital Services Prices fell 0.4% and Capacity Utilization for Electrical Equipment Manufacturing dropped 1.8%. Overall, the Index’s position and recent movement suggest that medical equipment investment growth will likely remain weak over the coming six months.
Mining & Oilfield Machinery
Investment in Mining & Oilfield Machinery jumped 47% (annualized) in Q1 2023 and was 15% above year-ago levels. The Mining & Oilfield Machinery Momentum Index inched up from 78.0 in April to 78.8 in May. In April, the S&P 500 Steel Index fell 5.9% while Mining & Logging Employment Rose 1.1%. The current position and recent movement of the Index suggest that mining & oilfield machinery investment growth is likely to remain steady over the coming two quarters.
Aircraft
Investment in Aircraft plunged at a 43% (annualized) rate in Q1 2023 but was 55% above year-ago levels. The Aircraft Momentum Index declined from 108.7 in April (revised) to 102.5 in May. The S&P 500 Volatility Index fell 16% and the Market Cap of Southwest Airlines dipped 6.9% in April. Overall, the Index’s position and recent movement suggest that aircraft investment growth may continue to decelerate over the coming two quarters, though growth likely will remain in positive territory.
Ships & Boats
Investment in Ships & Boats fell at an annualized rate of 1.4% in Q1 2023 but was 7.7% above its year-ago level. The Ships & Boats Momentum Index fell from 97.8 in April (revised) to 95.9 in May. In April, the Conference Board Consumer Confidence Index fell 2.6% and Grain & Oilseed Milling Shipments dropped 0.5% in March. Overall, the Index’s position and recent movement suggest that ships & boats investment growth could decelerate sharply over the coming six months.
Railroad Equipment
Investment in Railroad Equipment increased 29% (annualized) in Q1 2023 and was up 41% year-over-year. The Railroad Equipment Momentum Index inched down from 89.4 in April (revised) to 89.3 in May. In March, Capacity Utilization of Transportation Equipment edged down 0.8% and Capacity Utilization for Mining, Oil, & Gas Extraction fell 0.6%. Overall, the current position of the Index suggests that railroad equipment investment growth may decelerate but will likely remain in positive territory over the coming six months
Trucks
Investment in Trucks dipped 5.0% (annualized) in Q1 2023 but was 12% above year-ago levels. The Trucks Momentum Index dropped from 93.3 in April to 86.7 in May. In March, Industrial Production of Light Trucks decreased 3.3% and Industrial Production of Heavy-Duty Trucks dropped 4.5%. Overall, the position and recent movement of the Index indicate that trucks investment growth may begin to cool over the coming two quarters
Computers
Investment in Computers fell 7.9% (annualized) in Q1 2023 and was down 12% year-over-year. The Computers Momentum Index increased from 93.4 in April to 95.9 in May. Total Revolving Debt increased 0.4% in February and the Nasdaq Computer Index increased 1.0% in April. Overall, the Index’s position and recent movement suggest that computers investment growth may have bottomed out and could start to recover over the coming six months.
Software
Investment in Software rose 2.8% (annualized) in Q1 2023 and was up 10% from a year prior. The Software Momentum Index dropped from 97.4 in April (revised) to 94.2 in May. In April, IBM’s Share Price fell 3.6% and the ISM Non-Manufacturing Prices Index ticked up 0.2%. Overall, the Index’s position and recent movement suggest that software investment growth is unlikely to accelerate much over the coming two quarters.
