NEW YORK (Reuters) - The U.S. architecture billings index, a leading indicator of nonresidential construction activity, reached its highest level since December 2007 last month, the American Institute of Architects said on Wednesday.
Its index rose more than 3 points from October to a reading of 52 for November, marking only the second time this year the index has crossed the 50 mark, which indicates expansion.
A separate index of new project inquiries dipped 0.3 to 61.4 last month.
The billings index, by tracking demand for design services, is considered an indicator of construction activity nine to 12 months in the future, and is widely tracked by companies that generate sales from the construction sector.
“While this is heartening news, it would be premature to say the design and construction industry is out of the woods yet,” said AIA Chief Economist Kermit Baker.
Most diversified industrial companies get at least some revenue from nonresidential construction, selling machinery used for erecting buildings or components such as elevators or electrical and cooling systems.
A partial list includes Honeywell International Inc (HON.N), Tyco International Ltd TYC.N, Johnson Controls Inc (JCI.N), Caterpillar Inc (CAT.N), Deere & Co (DE.N) and Terex Corp (TEX.N). European companies, like lock maker Assa Abloy (ASSAb.ST) also participate in the sector.
Reporting by Nick Zieminski; editing by Carol Bishopric