Wednesday, May 19, 2010

AIA ABI Index for April 2010

This morning, I found a press release about the April 2010 AIA ABI Index. I found this on I don't think that it has yet been published on the AIA's own site. You will read in the press release that the AIA ABI Index climbed to 48.6 in April 2010. While it is good news that the index is climbing, any reading below 50, so we are told by the AIA chief economist, still points to "declining" demand. Last month, I made a prediction that the AIA ABI Index would hit 50 or above in May. I'm holding to that prediction. Here's the April 2010 Press Release I found on Reuters:

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U.S. Architecture Billings Index (ABI Index) up in April--AIA
(Reporting by Nick Zieminski; editing by Andre Grenon)

* April 2010 architecture billings index up 2.4 pts
* New project inquiries edge up
* Construction nearing 'recovery phase'

NEW YORK, May 19 (Reuters)
- A leading indicator of U.S. nonresidential construction spending rose for the third consecutive month in April, approaching a level that indicates expansion in the sector as the economy recovers, according to an architects' trade group.

The Architecture Billings Index was up 2.4 points to 48.5 last month, its highest since January 2008, according to the American Institute of Architects. A measure of inquiries for new projects rose 1 point to 59.6, after a 6 point increase in March.

Readings above 50 indicate expansion, while those below 50 to declining demand.

"The design and construction industry may be nearing an actual recovery phase," AIA Chief Economist Kermit Baker said in a statement.

Of four U.S. geographic regions, only the Northeast was above 50 in April, while all four construction sectors remained below that mark. Categories include institutional architecture, commercial and industrial space and the mixed-practice category, which often combines retail with other uses.

The AIA's billings index, begun in 1995, is a measure of construction spending nine to 12 months in the future. It is often cited by companies that sell to the construction sector as a gauge of that market.

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Joel’s further comments:

The Press Release I read on Reuters also gives a list of public companies that “generate revenue from construction”. You might find that list interesting. The list did not include ARC (NYSE: ARP).

The full press release can be found at this Internet address:

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