U.S. Building Material Update

Analysts Timna Tanners and PT Luther at UBS have released an update on U.S. Building Materials.

On Thursday, the U.S. senate passed the Jobs Bill, which includes an extension of expired highway spending program SAFETEA-LU to December, 2010. Analysts believe that this is a positive development as it gives visibility to state funding beyond short extensions. The bill is expected to be passed by President Obama and will transfer $20 billion to the highway trust fund in 2010.

According to analysts, recent strong highway awards data and steady stimulus outlay from the government will result in positive aggregate volume growth in the public construction market, which has declined for 4 years now, in 2010.