Wholesale Sales Up on Autos, Inventories Match Expectations
Wholesale trade expanded for September, according to a Commerce Department report (link opens a PDF) released today.
After increasing a revised 0.4% for August, wholesales sales grew a seasonally adjusted 0.6% to $430.5 billion for September.
While wholesale trade is used as an indicator of economic strength, investors pay close attention to durable goods as a potential sign of more sustainable confidence (or lack of it). For September, durable goods sales growth clocked in at 2.1% month over month, driven ahead by an 8.5% jump from the automotive business.
Nondurable goods sales didn't fare as well, dropping off 0.7% due primarily to declines in agricultural and petroleum products.
Investors also keep a close eye on inventories. If factories are expanding their supplies, it could be a sign that wholesalers expect demand to pick up in the near future. For September, overall inventories increased 0.4%, matching analysts' expectations.
To understand the rate at which goods are being made and sold, economists compute an inventories/sales ratio. Since sales and inventories both grew similar absolute dollar amounts from August to September, the inventories/sales ratio stayed steady at 1.18.
The article Wholesale Sales Up on Autos, Inventories Match Expectations originally appeared on Fool.com.
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