Construction Executives Predict Order Books Will Plunge through February, Despite Stable Current Conditions.MURRAY HILL Murray Hill may refer to one of the following places:
Expectations for Price Levels Increase U.S. construction executives surveyed in November predict that order books will plummet through February, suggesting that despite low interest rate levels and a mildly revived domestic economy the rate of new construction will slow sharply. According to according to prep. 1. As stated or indicated by; on the authority of: according to historians. 2. In keeping with: according to instructions. 3. The Dun & Bradstreet Corporation's November survey of 200 construction executives, employment levels will drop significantly, but price levels will improve. Indexes for current conditions reflect continued strength in the housing and public works public works pl.n. Construction projects, such as highways or dams, financed by public funds and constructed by a government for the benefit or use of the general public. Noun 1. sectors, and remain largely in line with year-ago levels. "One might expect that an economy defined by very low inflation and minimal unemployment, affordable mortgage lending terms, and continued consumer confidence would send construction sector expectation levels soaring," said Joseph W. Duncan, chief economic advisor to The Dun & Bradstreet Corporation. "It is possible this survey reflects concerns that the credit crunch Credit Crunch An economic condition whereby investment capital is difficult to obtain. Banks and investors become weary of lending funds to corporations thereby driving up the price of debt products for borrowers. that overtook o·ver·took v. Past tense of overtake. the construction industry this fall would freeze new projects. We anticipate expectation levels to recover in the coming months, given the recent stabilization of the bond market that finances a significant portion of the construction sector." Construction Executives Significantly Downgrade Downgrade A negative change in the rating of a security. Notes: For example, an analyst may downgrade a stock from strong buy to buy, or a bond rating agency may downgrade a bond from AAA to AA. Expectations Levels for Order Books, Yet Predict Rise in Prices The November D&B survey suggests that the rate of new construction in the coming three months will slow down to a trickle, as reflected in the Order Books Index, which dropped 18 points, to 0. Optimism levels for employment in the December 1998 - February 1999 period also slid significantly, with that index down four points, from 11 to 7. When compared to the year-ago period, the Order Books Index has plummeted 25 points and the Employment Index fell 19 points. At the same time, however, executives surveyed predict that price levels will improve, with the Prices Index adding five points, from 15 to 20. The Prices Index, when compared to the November 1997 survey, remained strong, adding one point, from 19. Current Conditions in November Reflect Continued Strength Overall Executives interviewed for the November survey reported modest gains in order books and prices, and unchanged results for employment levels. The Order Books Index measuring current conditions increased one point, from 23 to 24. The Prices Index added three points, to 28. The Employment Index remained unchanged at three. This is four points ahead of the September 1998 survey, but five points below the year-ago survey. The Dun & Bradstreet Corporation The Dun & Bradstreet Corporation (NYSE NYSE See: New York Stock Exchange : DNB DNB Dictionary of National Biography DNB Drum N Bass (music) DNB De Nederlandsche Bank DNB Dun & Bradstreet (stock symbol) DNB Den Norske Bank DNB David Nelson Band ) consists of the Dun & Bradstreet operating company operating company A business that engages in transactions with outsiders. (D&B), the leading provider of business-to-business credit, marketing and purchasing information, and receivables management services, and Moody's Investors Service Moody's Investors Service A leading global credit rating, research and risk analysis firm. Moody's Investors Service A leading firm engaged in credit rating, risk analysis, and research of fixed-income securities and their issuers. , the leading debt-rating agency and a major provider of analytical and financial information for capital market investors. The corporation, headquartered in Murray Hill, N.J., employs 13,000 people in 39 countries and reported 1997 revenue from continuing operations continuing operations Parts of a business that are expected to be maintained as an ongoing segment of an overall business operation. Income and losses from continuing operations are reported separately if any segments have been discontinued during the of $1.8 billion. Additional information about The Dun & Bradstreet Corporation is available through its Web site, www.dnbcorp.com. -0-
THE DUN & BRADSTREET CONSTRUCTION SURVEY
1997 1998 1998 1998
Nov. Sept. Oct. Nov.
Three-Month Expectation Indexes
Order Books 25 25 18 0
Employment 19 16 11 7
Prices 19 14 15 20
Current Conditions Indexes
Order Books 23 18 23 24
Employment 8 -1 3 3
Prices 26 28 25 28
The indexes are calculated by subtracting the percentage of respondents expecting a decrease in new orders, employment and prices from the percentage expecting an increase. Source: Economic Analysis Department The Dun & Bradstreet Corporation |
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