Heavy Duty Trucking Logo
MenuMENU
SearchSEARCH

Economic Watch: Latest Readings Don’t Merit Wall Street's Panic

The underlying fundamentals of the U.S. economy are better than, or at least nowhere near as bad as, the panic that set into Wall Street starting late last week and extended into Monday, according to several newly released reports.

Evan Lockridge
Evan LockridgeFormer Business Contributing Editor
August 25, 2015
Economic Watch: Latest Readings Don’t Merit Wall Street's Panic

 

6 min to read


The underlying fundamentals of the U.S. economy are better than, or at least nowhere near as bad as, the panic that set into Wall Street starting late last week and extended into Monday, according to several newly released reports.

The U.S. Commerce Department on Tuesday said July sales of newly built, single-family homes rose 5.4% from the month before, to a seasonally adjusted annual rate of 507,000 units.

Ad Loading...

This marks a big turnaround from a 7.7% drop in June from May. Home sales are 21.2% higher through the first seven months of this year than to the same time in 2014.

“Today’s report is in line with other government data and improving builder sentiment and shows a gradual but consistent housing recovery,” said National Association of Homebuilders Chief Economist David Crowe. “As job growth and consumer confidence continue to strengthen, the housing market should make additional gains this year.”

The report follows a separate one from last week showing existing-home sales steadily increased for the third consecutive month in July. Stubbornly low inventory levels and rising prices, rather than any larger economic issues, are likely to blame for sales to first-time buyers falling to their lowest share since January, according to the National Association of Realtors.

Ad Loading...

Total existing-home sales, which are completed transactions that include single-family homes, townhomes, condominiums and co-ops, increased 2% to a seasonally adjusted annual rate of 5.59 million in July from a downwardly revised 5.48 million in June.

Sales in July remained at the highest pace since February 2007. They have now increased year-over-year for 10 consecutive months and are 10.3% above a year ago.

Lawrence Yun, NAR chief economist, said the increase in sales in July solidifies what has been an impressive growth in activity during this year's peak buying season.

"The creation of jobs added at a steady clip and the prospect of higher mortgage rates and home prices down the road is encouraging more households to buy now," he said. "As a result, current homeowners are using their increasing housing equity towards the down payment on their next purchase."

Single-family home sales increased 2.7% to a seasonally adjusted annual rate of 4.96 million in July, the highest since February 2007, and are now 11% above the pace from a year ago.

Ad Loading...

Consumer Confidence Jumps, Leading Indicators Slip

Also on Tuesday, the private research group The Conference Board reported its Consumer Confidence Index, which had declined sharply in July, rebounded in August.

The index now stands at 101.5, up from 91 in July. The Present Situation Index increased from 104 last month to 115.1 in August, while the Expectations Index improved to 92.5 from 82.3 in July.

“Consumers’ assessment of current conditions was considerably more upbeat, primarily due to a more favorable appraisal of the labor market,” said Lynn Franco, director of economic indicators at The Conference Board. “The uncertainty expressed last month about the short-term outlook has dissipated and consumers are once again feeling optimistic about the near future. Income expectations, however, were little improved.”

The survey was conducted before the big drop on Wall Street late last week and into Monday.

This report came in the wake of one a few days earlier from the group that showed its Leading Economic Index for the U.S. declined 0.2% in July to 123.3, following a 0.6% increase in June, and a 0.6% increase in May.

Ad Loading...

The index is used to predict where the American economy is headed in the next three to six months.

“The U.S. LEI fell slightly in July, after four months of strong gains. Despite a sharp drop in housing permits, the U.S. LEI is still pointing to moderate economic growth through the remainder of the year,” said Ataman Ozyildirim, director of business cycles and growth research at The Conference Board.

Service, Manufacturing Activity Throttle Back

Meantime, on Tuesday a first look at how the nation’s service sector is performing shows it losing momentum this month, hitting its second lowest level since January.

The Flash U.S. Services Purchasing Managers’ Business Activity Index from the financial information services provider Markit fell from 55.7 in July to 55.2 this month, but is still well above the neutral 50 threshold.

Companies that reported a rise in business activity generally cited improving U.S. economic conditions and rising new business volumes. August data, nonetheless, pointed to a marked slowdown in new business growth from the three-month high recorded in July. The latest increase in new work received by service providers was the slowest since January and softer than the average since the series began in late 2009. Some survey respondents commented on more subdued business sentiment and cautious spending patterns among clients.

Ad Loading...

“August data signals a renewed slowdown in U.S. service sector growth, and this comes hot on the heels of a 22-month low recorded by the latest flash Manufacturing PMI survey,” said Tim Moore, senior economist at Markit. “Moreover, service providers’ new business volumes expanded at the slowest pace since January, suggesting that underlying momentum within the U.S. economy had shifted down a gear even before the recent global market turmoil and escalating worries about China’s growth outlook gathered on the horizon.”

Meantime, U.S. manufacturers indicated a renewed loss of momentum during August in a report last Friday, with output, new business and payroll numbers all increasing at a slower rate than in the previous month.

As a result, the headline seasonally adjusted Markit Flash U.S. Manufacturing Purchasing Managers’ Index dipped from 53.8 in July to 52.9 in August. That's still above the neutral 50 threshold, but the lowest since October 2013.

The main factor weighing on the headline index was a slowdown in manufacturing output growth from the three-month high recorded during July. Also, the latest rise in production volumes was the weakest since the weather-related slowdown recorded in January 2014. Some survey respondents cited a cyclical slowdown in new business growth, as well as heightened uncertainty regarding the demand outlook in August.

The survey indicated a solid expansion of overall new order volumes received by manufacturers, but the rate of growth moderated slightly since July. Subdued export sales remained a drag on new business intakes in August. Reflecting this, new work from abroad decreased for the fourth time in the past five months, with a number of firms attributing the decrease to competitive pressures related to the stronger currency exchange rate. There were also reports that weak capital spending among energy sector clients continued to weigh on some manufacturers’ order volumes.

Ad Loading...

“August’s survey highlights a lack of growth momentum and continued weak price pressures across the U.S. manufacturing sector, which adds some fuel to the dovish argument as policymakers weigh up tightening policy in September,” said Moore. “With the headline PMI swiftly losing ground after a modest rebound during July, the latest figure now points to the weakest overall pace of manufacturing growth for almost two years.

According to survey respondents, the strong dollar continued to put pressure on export sales and competitiveness, while heightened global economic uncertainty appeared to have dampened client spending both at home and abroad. Alongside this, manufacturers of investment goods widely cited growth headwinds from the slump in capital spending across the energy sector.

More Fleet Management

A woman holding a tablet with a screen showing rectangles of various colors
SponsoredSeptember 16, 2026

Color Match Smarter: Tools That Restore & Perform

For fleet managers and collision repair professionals keeping heavy-duty trucks on the road, getting the color right the first time isn't just about appearance — it's about efficiency, turnaround time, and bottom-line results. Discover how today's digital color tools are transforming the repair process from guesswork to precision.

Read More →
Mobile tablet showing Motus screen against highway background with Motus logo
Fleet Managementby StaffSeptember 15, 2026

FMCSA Pauses Biennial-Update Enforcement Amid Motus Transition

Carriers whose updates were due on or after June 1 have more time, while FMCSA works to stabilize its new registration system and warns of phishing sites impersonating its new carrier registration system, Motus.

Read More →
Geotab Whitepaper Cargo Theft Cover
SponsoredSeptember 14, 2026

2026 Blueprint for Countering Smarter Supply Chain Theft

Cargo theft is no longer just the cost of doing business. It's a multi-billion-dollar criminal enterprise exploiting vulnerabilities across your fleet, drivers, and supply chain.

Read More →
Ad Loading...
A monitor with a bar graph with a person sitting next to it wearing a headset.
SponsoredSeptember 1, 2026

How Telematics Improves Visibility, Control, and Performance in Refrigerated Fleets

Explore how telematics help refrigerated fleets improve visibility, uptime, efficiency, compliance, and cargo protection across connected cold chain operations.

Read More →
Graphic with U.S. and Canadian flags over background illustration of an ink-stamp that says Tariffs.
Equipmentby Deborah LockridgeAugust 24, 2026

What the U.S.-Canada Trade War Means for Trucking

Escalating U.S.-Canada tariffs could disrupt cross-border freight, reduce truck volumes, raise costs, and create new uncertainty for carriers on both sides of the border.

Read More →
Fleet Managementby News/Media ReleaseAugust 24, 2026

What Are Trucking’s Top Concerns for 2026?

The American Transportation Research Institute wants to know what's worrying trucking fleet managers, drivers, and other stakeholders in its annual Industry Issues survey.

Read More →
Ad Loading...
Four men in suits on the National Mall with giant video screen showing capitol building in the background
Fleet Managementby Deborah LockridgeAugust 24, 2026

American Trucking Associations Looks for a New Leader

ATA President and CEO Chris Spear abruptly left his job at the association on August 21, at a pivotal time for the trucking industry.

Read More →
The Cyber Stop column header with photo of a smiling driver in truck with a laptop and a wi-fi icon
Fleet ManagementAugust 21, 2026

Public Wi-Fi Cybersecurity Risks: How Truck Drivers and Fleets Can Protect Their Data

Public Wi-Fi can expose truck drivers and fleets to credential theft, malware, and other cyber threats. Here’s how to reduce the risk on the road.

Read More →
Woman in white blazer superimposed on background showing a row of Fraley & Schilling truck, plus the HDT Truck Fleet Innovators 2026 logo
Fleet Managementby Deborah LockridgeAugust 19, 2026

For Nicky Cupp, Fleet Innovation Starts With Frustration

HDT Truck Fleet Innovator Nicky Cupp turns everyday pain points at Fraley & Schilling into opportunities for better technology and smarter processes.

Read More →
Ad Loading...
Headshot of Adam Buttgenbach with a Pepsi-branded Tesla Semi in the background
Fleet Managementby Deborah LockridgeAugust 18, 2026

Adam Buttgenbach’s Approach to Electric Trucks: Start With Where They Fit

HDT Truck Fleet Innovator Adam Buttgenbach helped PepsiCo build one of North America’s largest EV fleets by focusing on where electric trucks make operational sense.

Read More →