Manufacturing materials suppliers will continue to face "an uncertain environment about fresh investments in factories, computers, telecommunications equipment and other capital goods," says economist Richard Berner at Morgan Stanley. "What you are seeing in the market is a low level of capital spending caused by a high degree of risk aversion."

Dow Corning Electronics plans to become a supplier in the U.S., Europe and Asia of fabricated thermal materials, also known as phase change materials, by the end of the year. Phase change resins are designed around silicon-organic polymers made from functionalized siloxanes, organic materials and thermally conductive fillers.

Analyst Joel Wagonfeld at Banc of America believes there will be no global sales growth for personal computers this year and has reduced his 2003 sales outlook to 8% growth. "PC makers are admitting that information technology spending will continue to be sluggish next year," he says. "Also, sales growth will come primarily from such less mature markets as Asia Pacific and Latin America, while the U.S. and Europe will lag."

The fragile economic recovery is contributing to ongoing weakness in purchases of business aircraft, says analyst Kenton Freitag at Standard & Poor's. "Not only is the business aircraft business in the midst of a downturn," he says, "but the glut of used turboprop and jet business aircraft is frustrating the ability of producers to achieve cash flow and debt-reduction targets."

North American production of Class 8 heavy-duty trucks could decline 13% to 727 in the fourth quarter from a third-quarter level of 868, forecasts Stark's Truck and Off-Highway Ledger of Chicago. Orders will fall because the nation's largest truck fleets purchased vehicles ahead of the Oct. 1 deadline for stricter diesel emission standards. Most trucking firms have yet to test the new, more expensive engines that meet the standards. So, they remain concerned about fuel efficiency, durability and reliability.

Morgan Stanley analyst Stephen Girksy now expects U.S. motor vehicle sales to total 17 million units this year, very close to the 17.2 million sold in 2001. However, he agrees with Lehman Brothers analyst Darren Kimball that 2003 vehicle sales will drop to 16.4 million. With inventories building this year, both predict a reduction in assembly next year.