Operator Notes

Here is what the ISM April report actually says if you read past the headline: 69% of survey panelists were negative. The Iran conflict was cited in 47% of responses. The Prices Index is at its highest level since April 2022. New Export Orders are in contraction. Employment is in contraction for the 31st consecutive month.

The sector is expanding in the sense that orders and production are growing. It is not expanding in the sense that it's hiring people, keeping input costs stable, or operating free from geopolitical disruption. If you're buying a manufacturing business in this environment, underwrite what's real. The headline PMI is not the business you're buying.