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Service ISM Posts First Miss And Decline In 3 Months, Employment Index At Highest Since March

Tyler Durden's picture


Moments ago the Non-manufacturing ISM came out, and in keeping with the theme of Baffle with BS, started last night when the China HSBC services PMI dropped even as the Manufacturing PMI from last week signaled the start of a "new recovery" or something (just don't look at the Baltic Dry, and definitely don't look at the endless barrage of reverse repos proving the PBOC will not engage in wholesale easing), it printed the first miss and decline in three month, coming at 54.2 on expectations of a 54.5 print and down from 55.1 previously. What is troubling is that while otherwise an economic miss such as this one would have been sufficient to ramp the bizarro marke, today it has merely sent ES to fresh intraday lows. Perhaps the reason is that unlike last week's Manufacturing ISM, whose headline was good but internals were not, this time it is the other way around with New Orders down but Employment rising from 51.1 to 54.9, the highest since March. Does this meant the Fed will prematurely end QEternity? Of course not, but the market appears to be shooting first, as usual, and asking questions later.

And from the respondents:

  • "Business with markets and customers we serve remains strong." (Management of Companies & Support Services)
  • "Business is steady, with good fourth quarter expected." (Information)
  • "The sluggish pace of economic recovery coupled with rapid increases in gas prices on the West Coast continue to drag down customer traffic and discretionary spending. Levels remain well below last year." (Arts, Entertainment & Recreation)
  • "Ongoing concerns about healthcare reform; reluctance to expand or hire." (Health Care & Social Assistance)
  • "Outlook is positive yet still guarded. Clients have some pent-up demand that they are acting on with short-term contracts." (Professional, Scientific & Technical Services)
  • "More companies seeking relief from fuel increases." (Public Administration)

Finally, for those seeking deflation, look elsewhere:

Commodities Up in Price

Beef; Chemical Products; Chicken; Computer Products; Copper Products; Corrugated Products; Dairy (2); #1 Diesel Fuel (3); #2 Diesel Fuel* (3); Food Products (2); Fuel (4); Fuel Surcharges; Gasoline* (10); Gasoline Related (2); Medical Supplies*; Oils; Packaging Supplies; Pallets; Paper; Pharmaceuticals; Pharmacy Products; Plastic/Poly Bags (3); Pork; Produce; and Urea.

Commodities Down in Price

#2 Diesel Fuel*; Gasoline*; Lumber; Medical Supplies*; and Soybean Meal.

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Mon, 11/05/2012 - 11:19 | 2948555 Shizzmoney
Shizzmoney's picture

Perhaps the reason is that unlike last week's Manufacturing ISM, whose headline was good but internals were not, this time it is the other way around with New Orders down but Employment rising from 51.1 to 54.9, the highest since March.

Wait, is it an election year?

Mon, 11/05/2012 - 11:24 | 2948561 SheepDog-One
SheepDog-One's picture

Well they have 1 more day of 'Cuz its election year' left....then what?

Mon, 11/05/2012 - 12:06 | 2948771 LMAOLORI
LMAOLORI's picture



Those job numbers are a joke

If we measure unemployment the way we did in the 1930s, today’s unemployment would be worse than any single year during the Great Depression


Mon, 11/05/2012 - 12:11 | 2948789 CPL
CPL's picture

Not if all those jobs created are minimum wage...or the new "standard wage".


It's okay though, civil servants will be getting massive paycuts as well on top of massive layoffs unseen in the USA.

Mon, 11/05/2012 - 12:37 | 2948861 JPM Hater001
JPM Hater001's picture


And that's all I have to say about that.

Mon, 11/05/2012 - 11:19 | 2948559 SheepDog-One
SheepDog-One's picture

These people are delusional, crime is rampant even in good neighborhoods here robberies and gas siphoning is epidemic....theyre dreaming putting hollandaise sauce on a shit sandwich.

Mon, 11/05/2012 - 11:24 | 2948575 bigdumbnugly
bigdumbnugly's picture




Mon, 11/05/2012 - 11:24 | 2948574 PUD
PUD's picture

Someone was hired to put all those "yes we can" signs on all those suburban lawns.

Mon, 11/05/2012 - 11:25 | 2948579 TrustWho
TrustWho's picture

Storm Sandy's impact is not in the numbers. Who is going to be buying Christmas presents in NJ, NY, and CT? At the margin, this will have significant impact on disposable income and retail sales for the nation.

Mon, 11/05/2012 - 11:32 | 2948619 disabledvet
disabledvet's picture

This cannot be a surprise. The treasuries that GOLDMAN SAYS SHORT have been front running the Fed everytime Bernanke-son so much as FARTS QE. Now we're going to have retail sales misses by a COUNTRY MILE courtesy of Sandy...more than likely FAR WORSE as ELECTRICITY is STILL not working for New Jersey's REFiNERIES. "Philadelphia will now commence the ass-whooping."

Mon, 11/05/2012 - 11:33 | 2948626 ihedgemyhedges
ihedgemyhedges's picture

Ez to explain: New orders down mean future sales down means hire more unemployed commission only sales people to try to get sales back up not costing anything really if they bug out.....

Mon, 11/05/2012 - 11:56 | 2948639 larz
larz's picture

Thanks Kev btfd this is getting stupid but id rather be lucky than smart


this is really stoopid im not even happy im trading well


donating all to red cross

Mon, 11/05/2012 - 11:52 | 2948712 ebworthen
ebworthen's picture

Why is Soylent Green missing from the list of commodities?

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