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September Inventories were -0.1% versus an expected up 0.4% and against a revised up 0.6% in August (previously up 0.8%). Wholesale Inventories dropped the most since December 2006.

Durable Goods Inventories were up 0.8%, Apparel Inventories were up 2.8%, Machinery was up 2% and Electrical Inventories were up 1.9%.
Non-Durable Inventories were down 1.4% - the largest drop since December 1996 when they were down 2.5%. Automotive inventories fell 0.3% and Drug inventories fell 3.3%.
Petroleum Inventories were down 3.5%, the largest drop since March 2008.

Wholesale Sales were down 1.5%, the steepest drop since a 1.6% decline in April 2003. Durable Sales were down 1.0% and Non-Durables were down 1.9%, the largest drop since January 2007.

Petroleum Wholesale Sales were down 3.6%, Farm Product Sales were down 7.8%, the largest drop in a year and after falling 3.2% in August. Machinery Sales were down 1.6% and Metals Sales were down 1.6%.
Computer Equipment Sales were up 2.7%, Furniture Sales were up 1.1% and Alchohol Sales were up 3.4%.

The Inventory Sales/Ratio was 1.12 from 1.10 in August. The Durable Goods Inventory/Sales ratio was 1.56, the highest since May 2003 when it was 1.59 (August was also the highest since May 2003).

This is the second month in a row of falling Wholesales Sales and October, with Petroleum prices cratering, is also likely to be down.

• September Wholesale Inventories are expected to gain 0.4% following a 0.8% increase in August
• Shipments are expected to fall 2% after a 1% drop prior
• The Inventory-to-Sales ratio is expected at 1.13 from 1.10 in August

Petroleum inventories are likely to have the largest impact on the September data, as lower energy prices will bring down the total value of petroleum inventories. (Petroleum stocks’ value rose 1.3% in September after a 2.7% increase in August.) Reduced gas demand could help support petroleum inventories in the near term; nonetheless the trend has clearly shifted and petroleum inventories are likely to post consistent declines going forward.

Ex-petroleum inventories should continue to rise at a modest pace after gaining 0.8% in August and 1.5% in July. Wholesale shipments are expected to fall for a third consecutive month, with an increasing rate of decline helping to establish a clear downward trend going into the final quarter of ’08.

Related data:
• September Factory Orders fell 2.5% following a 4.3% drop in August
• The September Employment report revealed a 0.7% drop in wholesale hours worked

• September Wholesale Inventories are expected to gain 0.4% following a 0.8% increase in August
• Shipments are expected to fall 2% after a 1% drop prior
• The Inventory-to-Sales ratio is expected at 1.13 from 1.10 in August

Petroleum inventories are likely to have the largest impact on the September data, as lower energy prices will bring down the total value of petroleum inventories. (Petroleum stocks’ value rose 1.3% in September after a 2.7% increase in August.) Reduced gas demand could help support petroleum inventories in the near term; nonetheless the trend has clearly shifted and petroleum inventories are likely to post consistent declines going forward.

Ex-petroleum inventories should continue to rise at a modest pace after gaining 0.8% in August and 1.5% in July. Wholesale shipments are expected to fall for a third consecutive month, with an increasing rate of decline helping to establish a clear downward trend going into the final quarter of ’08.

Related data:
• September Factory Orders fell 2.5% following a 4.3% drop in August
• The September Employment report revealed a 0.7% drop in wholesale hours worked

August Wholesale Inventories rose 0.8%, more than the 0.3% expected and following an upwardly revised 1.5% increase in July. Durable goods inventories rose 1.4% with auto stocks up 1.2%, metals adding 3.3% and electrical inventories increasing 1.9% (highest since Jul-06). Among non-durables (down 0.1%), petroleum inventories increased 1.3% after a 2.8% rise in July. Grocery stocks jumped 2% (most since Mar-07), but farm products fell 2.3% and apparel dropped 1.5%.

August Wholesale Sales fell 1%, its biggest decline since Jan-07, after a 0.8% drop in July. Petroleum Sales declined 2% to lead non-durable goods sales (down 0.6%). Durable Goods sales fell 1.5%, the most since December, as auto sales dropped 2.2% and hardware sales tumbled 6.5%.

The inventory-to-sales ratio rose to 1.10 in August after an upwardly adjusted 1.08 in July. The Durables inventory-to-sales ratio was 1.53 and the non-durables ratio was 0.76.

* August Wholesale Inventories are expected to increase 0.3% following a 1.4% increase in July

* Wholesale Shipments are expected to fall 1.3% after a 0.3% decline prior

* The August wholesale inventory-to-sales ratio is expected marginally higher at 1.09

August Wholesale Inventories are forecast to rise, as they have nearly every month since the end of 2006. Inventories are nonetheless expected to post diminishing gains relative to previous months as expectations for a more pronounced slowdown in the US is likely to have reduced overall production.

Analysts’ forecasts for the data range from a marginal decline to a 1% increase; strong arguments can be made for both cases, though a higher-than-expected increase is more likely as rapid demand deterioration could push inventories higher — even with reductions in overall production.

Further declines in energy inventories, as a result of lower energy costs and logistical disallocations from the hurricane season, could push Wholesale Inventories lower than expected for August.

Related data:

* August Factory Orders fell 4%, Factory Shipments fell 3.5%

* September Wholesale Hours Worked fell 0.7%

* August Business Inventories grew 0.2%

• August Wholesale Inventories are expected to increase 0.3% following a 1.4% increase in July

• Wholesale Shipments are expected to fall 1.3% after a 0.3% decline prior

• The August wholesale inventory-to-sales ratio is expected marginally higher at 1.09

August Wholesale Inventories are forecast to rise, as they have nearly every month since the end of 2006. Inventories are nonetheless expected to post diminishing gains relative to previous months as expectations for a more pronounced slowdown in the US is likely to have reduced overall production.

Analysts’ forecasts for the data range from a marginal decline to a 1% increase; strong arguments can be made for both cases, though a higher-than-expected increase is more likely as rapid demand deterioration could push inventories higher — even with reductions in overall production.

Further declines in energy inventories, as a result of lower energy costs and logistical disallocations from the hurricane season, could push Wholesale Inventories lower than expected for August.

Related data:

• August Factory Orders fell 4%, Factory Shipments fell 3.5%

• September Wholesale Hours Worked fell 0.7%

• August Business Inventories grew 0.2%

Wholesale Inventories rose 1.4% in July, higher than the 0.7% expected and following a downwardly revised 0.9% increase in June. The July rise was driven by a 1.6% rise in Durable Goods inventories, with automobile stocks up 2.3% and machinery up 2.7%, the most in 11 years. In the non-durables category, which was up 1.1%, Petroleum inventories rose only 2.8% compared to the 8.9% jump in June. Bigger jumps came from chemicals (up 6.3%) and drugs (up 6.1%, the most since 1996).

Wholesale Sales were down 0.3% in July, their first decline since February, compared to a 3% increase in June. Petroleum Sales tumbled 5.9%, the biggest drop since Jan-07. Durable Goods Sales rose only 0.2%, hurt by Machinery sales that tumbled 3.7%, the most since Oct-01. Auto sales fell 1.4%.

The inventory-to-sales ratio rose to 1.07 in July from 1.06 in June. The Durables inventories-to-sales ratio was 1.47 and the Non-Durables ratio came in at 0.75.

• July Wholesales Inventories expected up 0.7% vs. a 1.1% increase prior
• July Wholesale Shipments expected up 1.1% vs. a 2.8% increase prior
• The July Wholesale Inventory-to-Sales Ratio is expected to be unchanged at 1.06

July Wholesales Inventories are expected to receive a boost from petroleum inventories, which increased 8.3% in June. Petroleum shipments increased 12.7% in June following a 9.9% May increase. Inventories ex-petroleum should continue to provide a modest boost to the headline data after increasing 0.8% in June. Ex-petroleum shipments are also expected higher following a 1% increase in June.

Related data:
• July Factory Orders grew more than expected at 1.3% and Factory Shipments grew 2.3%
• July Business Inventories grew 0.5%
• The Aggregate Wholesale Hours Worked component fell 0.1% in the July Employment report
• July ISM Manufacturing Inventories Index: 54.5 vs. 53 prior

• July Wholesales Inventories expected up 0.7% vs. a 1.1% increase prior
• July Wholesale Shipments expected up 1.1% vs. a 2.8% increase prior
• The July Wholesale Inventory-to-Sales Ratio is expected to be unchanged at 1.06

July Wholesales Inventories are expected to receive a boost from petroleum inventories, which increased 8.3% in June. Petroleum shipments increased 12.7% in June following a 9.9% May increase. Inventories ex-petroleum should continue to provide a modest boost to the headline data after increasing 0.8% in June. Ex-petroleum shipments are also expected higher following a 1% increase in June.

Related data:
• July Factory Orders grew more than expected at 1.3% and Factory Shipments grew 2.3%
• July Business Inventories grew 0.5%
• The Aggregate Wholesale Hours Worked component fell 0.1% in the July Employment report
• July ISM Manufacturing Inventories Index: 54.5 vs. 53 prior

Wholesale Inventories rose 1.1% in June, following an upwardly revised 0.9% increase in May. The larger-than-expected build was mainly a result of the 8.3% boost in petroleum inventories, the largest monthly increase since December ‘07, following a 0.8% increase in May. Durable goods inventories were up 0.6% in June — with inventories of metals up 4.2% — while non-durable inventories were up 1.8%.

Wholesale Sales were up 2.8% in June, the most since March ‘04 and following a 2.2% increase the prior month, which was largely a result of gov’t stimulus checks. Also leading wholesale sales higher was a 12.7% increase in petroleum sales, the most since April ‘02, from an upwardly revised 9.9% increase in May. Wholesale petroelum sales are up a hefty 68% year-over-year thanks to the combination of higher energy prices and USD deterioration.

Wholesale durable goods sales were up 1.3% in June following a 0.2% increase in May, and non-durable sales were up 4.1% following a 4% rise prior. Wholesale auto sales were down 4.7% and wholesale apparel sales tanked 7.9%.

The inventory-to-sales ratio fell to 1.06 in June from 1.08 in May. The durable goods inventory-to-sales ratio was 1.46 in June and the similar non-durable goods measure was 0.74.