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Morgan Stanley Index Shows Industrial Momentum Accelerated in July
A key Morgan Stanley indicator for industrial activity showed a notable acceleration in July, with the firm's Capital Goods Momentum Index (CAPMI) rising 5 points month-over-month to 58. The reading, which signals accelerating growth when above 50, reflects broad-based gains across all geographic regions tracked by the investment bank.
Broad-Based Regional Growth
According to the Morgan Stanley report, momentum improved across all sub-indices. The Global sub-index saw the largest increase, while the U.S. and Europe also posted solid gains.
- Global sub-index: Rose 7 points
- U.S. sub-index: Increased 5 points
- Europe sub-index: Added 5 points
- Asia-Pacific sub-index: Gained 3 points
Sector and Geographic Drivers
In the U.S., the advance was driven by strength in the General Industrial, Automotive, Oil & Gas, and HVAC sectors, though the report noted minor weakness in land freight. European data was supported by positive trends in Germany and the construction industry.
AdThe Asia-Pacific region showed a weaker overall performance, weighed down by China and Japan, although India recorded an improvement. Morgan Stanley noted that the modest gain in the Asia-Pacific reading was partly due to a weak April result dropping out of the index's moving average calculation.
About the CAPMI Index
The Morgan Stanley CAPMI is a proprietary index that measures the month-over-month momentum of 48 global macroeconomic and industry-specific indicators. A reading above 50 indicates accelerating growth, while a reading below 50 signals deceleration.
The index has a significant North American weighting (42%), followed by Europe (19%), Asia-Pacific (19%), and a Global component (21%). It tracks major industrial end markets including Aerospace, Automotive, Construction, and Technology.
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