The PricewaterhouseCoopers poll, which surveyed seniorexecutives at 60 industrial manufacturers from mid-July tomid-October, found that 48% of US-based industrial manufacturersfeel optimistic about the US economy over the next year, up from43% in Q2. At the same time, only 23% of respondents expect theirown businesses to regain strength before June, though another 45%expect to see business improve in the second half of next year. Anadditional 17% anticipate recovery the following year, while theremainder foresees no improvement for several years, if ever.

Significantly, the number of companies anticipating revenuegrowth over the coming year showed an even greater jump from Q2,with 57% answering positively in Q3 compared to only 43% threemonths earlier. On the other hand, 42% worry that profits mightfall. Though 75% expressed some level of concern about a lack ofdemand, the figure was down from 82% in Q2. And while only 25% ofrespondents indicated they plan to add employees over the next 12months, that figure also was up from the preceding quarter. Inaddition, 37% now plan to make major capital investments, comparedwith 27% in Q2.

According to the Tempe, AZ-based ISM, October marked the thirdconsecutive month of growth as measured by its various indexes.Among the monthly readings showing marked improvement werethefactory services index, which rose to 55.7% from 52.6% inSeptember; the employment index, which went to 53.1% from 46.2%;and the business activity, which rose 3.1 points to 55.7%, itshighest rate of growth since April '06. Numbers above 50 indicateexpansion, while those below indicate contraction. Probably themost encouraging change came in the production index, which surged7.6 points to 63.3%.

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