Weekly Market Pulse: Machinery & Construction | North America

Research evidence excerpt

Weekly Market Pulse: Machinery & Construction | North America

Idea

July 20, 2026 04:30 AM GMT

Morgan Stanley & Co. LLCMMachinery & Construction | North America Angel Castillo

Equity Analyst

Weekly Market Pulse Angel.Castillo@morganstanley.comStefan Diaz, CFA +1 212 761-1931

Stefan.Diaz@morganstanley.com +1 212 761-1834

Construction backlog lower MoM, though still strong; Oliver Jiang

Construction confidence largely higher; Single-Family Housing ResearchOliver.Jiang@morganstanley.comAssociate +1 212 761-6458

Starts and Permits decreased MoM; US AEM Ag signals easing Esther O Osinaiya

Research Associate

sales decline; ACT Jun builds of 25.4k +16% MoM, Carrier/shipper Esther.Osinaiya@morganstanley.com +1 212 761-3176

survey show greenshoots; June IP +0.1% vs cons +0.2%. Machinery & Construction

North America

Industry View Attractive

Construction: The Associated Builders and Contractors' (ABC) Construction

Backlog Indicator fell 0.3 months MoM in June to 8.8 months, though was +0.1 YoY

and above every reading from September 2023 to April 2026. By category,

infrastructure carried the longest backlog (10.1 months, flat MoM), followed by

heavy industrial (9.7 months, -0.3 MoM) and commercial & institutional (8.9

months, +0.1 MoM). ABC's June Construction Confidence Index showed improving

readings for sales (63.6, +2.5pts MoM) and staffing (62.7 +1.4pts MoM), while the

profit-margins reading declined (52.4, -0.1pts MoM) to a 7 month low. All three

components remained above the neutral threshold of 50. June non-resi

construction input PPI declined -0.5% MoM, though the majority of the MoM

decline was driven by energy costs. On a YoY basis June's value rose +7.1%.

Construction rental and leasing PPI rose +4.7% MoM (+2.8% YoY) in June.