Manufacturing is expanding, but not as broadly as in November. There was weakness in new orders and employment.

The weakness was primarily in the residential area. That's consistent with the other data we've seen recently that suggest that the housing market is cooling off.

[Friday's] data clearly indicate that U.S. manufacturing may not be quite at a bottom. The weakness is led by computers and electronic equipment, but other categories are weak also.

Some jobs in manufacturing might well disappear as a result of weakness in housing, but this may be offset by jobs brought home or not lost to foreign competition.

We saw really good results in the first quarter but we just saw weakness at the end of the quarter, so we are giving conservative, and what we think is a prudent, approach in the next quarter,

There's still a bit of a tech wreck going on in the wake of the Nasdaq weakness. The other problem is that we haven't had good sector rotation and we've seen a bit of a sell-off in the banks. The results for the banks have not been too good - they are facing margin pressures.