'Damage lingers' in US capex

Hopes for a capital expenditure (capex) boom remain on hold.

Morgan Stanley's Capex Plans Index fell to 13.4 in December, the lowest reading since July 2013.

"Continued softness in capex plans echoes the declining trend in capital equipment orders and a heavy inventory correction that has weighed on the manufacturing sector. The effects of dollar strength and uncertainty over falling energy prices have been persistent themes in regional manufacturing surveys in 2015," Morgan Stanley's Ellen Zentner said in a note to clients on Tuesday titled "Damage lingers."

It's worth noting that while manufacturing is an important part of the US economy, it represents a small portion of it.

"In our 2016 US Economic Outlook, we forecast a modest expansion in equipment investment in 2016 as the trade- weighted dollar moves into a slower pace of appreciation, but the detrimental effects of past appreciation linger and persistently weaker global trade keeps growth subpar," Zentner said.