US Manufacturing output sinked 0.5% which is the biggest drop in last 16 months. According to the Feds report this reduction was primarily caused by 6% drop in motor vehicles and parts.

Our take: drop in US automotive industry could mean that consumers turn more and more toward foreign (especially Japan's) cars. At the same time since G7 failed to force Japan to change their monetary policies Japan's carmakers can continue getting bigger market share in Europe and US by offering "cheap" Hondas and Toyotas.

Target: S & C Funds / Short-term: Negative / Long-term: Neutral
            I Fund / Short-term: Positive / Long-term: Positive