Industrial Outlook Is a Mixed Bag for 2024
Near-term economic realities are challenging, but the prospect for long-term growth appears solid.
The US is on track to build a new data center every month.
Photographer: George Frey/AFP/Getty Images
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US factory activity has been in contraction territory for 13 consecutive months, the longest slump since the dot-com bubble burst more than two decades ago, according to the latest update of the Institute for Supply Management’s manufacturing benchmark released Dec. 1. About two weeks later, Japan’s Nippon Steel Corp. agreed to acquire United States Steel Corp. — a company that epitomizes the traditional industrial economy — at a whopping 142% premium to its unaffected share price. The deal is a bet that a stimulus trifecta targeting infrastructure investment, semiconductor production and the energy transition will spur increased domestic demand for construction materials and a revitalization of the US manufacturing supply chain. These two competing narratives perfectly encapsulate the backdrop for industrial stocks heading into 2024: It’s the best of times but also a rough time.