Some good news
European property sales are up.
The change in mood is also reflected in the latest data. Investment in European commercial property surged 53% in the third quarter to 19.6 billion, from 12.8 billion in the second quarter, according to Cushman & Wakefield, the property-services group. Still, that pales in comparison to earlier years. There was 44 billion in investment in European commercial property in the first nine months of 2009, compared with 203 billion in the same period of 2007.
Commercial Market Gains Footing - WSJ.com
Caterpillar calls a bottom.
"We believe the third quarter marked the low point for Caterpillar sales and revenues in what has been the toughest recession since the 1930s," said Chairman and Chief Executive Jim Owens. "We are seeing encouraging signs that indicate a recovery may be under way."
Caterpillar's Profit Falls 53% - WSJ.com
Business spending is beginning to rise.
Big companies that sell to corporate customers are growing more bullish about their prospects for 2010, a sign that a revival of business investment could buoy the sluggish U.S. economy in coming quarters.
Reporting on results for the latest quarter, bulldozer maker Caterpillar Inc. and hydraulic-parts maker Parker Hannifin Corp. on Tuesday joined a chorus of companies that are saying the worst of the recession is past and customers are buying anew rather than simply drawing down inventories.
Nonetheless, some firms are already seeing sales increases. Last week, Intel Corp. attributed strong third-quarter results mainly to sales of chips for laptop computers, driven in part by back-to-school sales, but Intel also is seeing healthy sales of a new line of chips for server systems that help lower electricity bills in computer rooms.
Intel Chief Executive Paul Otellini said the upturn wasn't simply the result of restocking of inventories but was part of a broader pattern of rising demand. In an interview this week, he credited consumers, who are now buying netbooks and laptops in record numbers.
Brian Bethune, an economist at forecasting firm IHS Global Insight, estimates business spending on equipment and software rose at a 7.3% annual rate in the third quarter.
"High tech is definitely doing well and is going to come out of the gate first here in terms of positive growth," said Mr. Bethune, who expects a 12.7% increase in fourth-quarter spending on equipment and software vs. the third quarter.
The CEO of Advanced Micro Devices Inc., Dirk Meyer, said his talks with chief information officers convince him that companies' tech purchases, which all but stopped in the recession, will resume next year. "Wallets are starting to free up," he said.
A report from the Manufacturers Alliance/MAPI released last week said "forward-looking indexes" such as annual orders are at much higher levels, indicating that manufacturing activity will increase in 2010.
Business Spending Looks Up - WSJ.com
And ...
According to Morgan Stanley, Oracle partners which represent 60,000 enterprise software consultants said that their business is at an inflection point and that headcount and pipeline growth is beginning.
I think Caterpillar may experience better sales internationally, but they are dreaming if they expect growth domestically. Why would anyone break ground on a new building when existing structures are now selling at an average of 60% of replacement cost? Infrastructure programs under the "stimulus" amount to only $98 billion - how much of that will go to heavy equipment is unknown, but I don't see more than 5% at best. If Cat is counting on State and local governments to boost sales, they must realize that state and local gov'ts are watching tax revenues drop sharply? I don't thing that public sector is going to experience growth anytime soon and common sense tells us that most of the private sector is tightening their belt in the face of economic uncertainty.
As for AMD and the other tech companies expecting increases, when your sales drop by 50% it takes a 100% increase just to get back to even! 12-15% quarterly increases over the worst quarter in history essentially amount to jack-squat. Year over year figures are still very, very grim......I remain extremely bearish.