Index still strong

Business conditions in Utah and around the country remained strong, if measured, in June, according to reports released Thursday.

The Utah Business Conditions Index slipped to 52 from May's 54, revealing some softness in inventory levels and new orders.

The index, prepared by the Creighton Economic Forecasting Group at Creighton University in Omaha, Neb., includes Utah, Colorado and Wyoming. Between 100 and 150 Utah supply managers representing a cross-section of industries are included in the survey. An index reading above 50 indicates economic expansion.

Meanwhile, the national Institute for Supply Management said its manufacturing index declined to 61.1 last month from 62.8 in May. As with the Creighton index, an ISM index reading above 50 indicates growth.

The ISM reading was somewhat lower than the 61.5 forecast by analysts. But some economists maintained that the June reading shows manufacturing activity is growing at a still robust, but more measured, pace.

"A slower pace that is still a solid pace is what these numbers are beginning to point to, and that's key," said Joel Naroff of Naroff Economic Advisors in Holland, Pa. "This is a level that's still very good but will create fewer inflationary pressures."

Still, stocks sagged Thursday after the report was released. At the close of trading, the Dow had lost 101.32, or 1 percent, to 10,334.16.

The broader gauges also finished lower. The Nasdaq composite index sank 32.24, or 1.6 percent, to 2,015.55, largely on weakness in the semiconductor sector. The Standard & Poor's 500 index fell 11.90, or 1 percent, to 1,128.94.

The Utah index found new orders at 50.9, production at 51.9, delivery speed at 50 and inventories at 48. Employment was the index's bright spot, at 52.

"Utah added more than 4,200 jobs in the first half of 2004, or just under 1 percent on an annualized basis. Based on recent surveys, I expect Utah's employed work force to grow by more than 1 percent on an annualized basis for the rest of 2004," said Ernie Goss, director of the Creighton Economic Forecasting Group, in a statement.

The June index for the three-state Rocky Mountain region rose to 60.4 from May's 55.7. In Colorado, the index declined to 57.6 from May's 61. Wyoming's Business Conditions Index for June rose to 70.6 from 67.5 in May.

The shortage of various commodities didn't do much to dampen confidence among supply managers and business leaders in the region. The confidence index for June stood at a strong 77.4, down slightly from May's 79.