Although the outlook on the U.S. economy has been glum lately, the Institute of Supply Management informs us that economic activity in services sector of the U.S. economy (which, according to Reuters, represents approximately 80% of economic activity) grew in September for the 22nd consecutive month. However, it should be noted that the growth rate did slow from the prior month.
The ISM Non-Manufacturing index for September was reported at 53.0, which was above the consensus estimate for a reading of 52.7 but below the August reading of 53.3.
With the exception of the employment index, the internal components of the report also showed strength. Below are the readings:
- Employment: 48.7 vs. 51.6
- New Orders: 56.5 vs. 52.8
- Business Index: 57.1 vs. 55.6
- Prices Paid (inflation): 61.9 vs. 64.2
The ISM indices are designed to indicate the state of the services sector in the economy. Readings above 50 are indicative of expansion while below 50 suggests contraction in the sector.
However, despite the upbeat headline numbers, respondents to the survey were not entirely optimistic.
According to Anthony Nieves, who is chair of the Institute for Supply Management (ISM), "Respondents' comments reflect an uncertainty about future business conditions and the direction of the economy."
Below are selected comments from the ISM survey:
- "Weak consumer confidence and high gas prices are placing downward pressure on retail sales volume."
- "Business volume outlook and confidence across many market areas in North America appear to be softening." (Mining)
- "It appears everyone is waiting to see what happens next. No trust in the economy or the federal government to do what is needed."
S&P 500 - Intraday
Remember, you are in control your email alerts! You can receive alerts for more than 25 free research report alerts including: The “10.0” Report, The Insiders Report, ETF Leaders Report, and The Focus List.
