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US Services PMI Slumps To Weakest In 4 Months (Ignores Manufacturing Renaissance)

Tyler Durden's picture




 

Much as the 3rd grade Markit US Manufacturing PMI 'beat' was blamed for the furious rally last Thursday in stocks, it appears bad news in the form of today's 3rd grade Markit Services PMI 'miss' is (rightly) completely ignored by the market. While the Services segment of the economy is vastly larger and more important for 'guessers', it seems USDJPY would not provide the juice this morning as this is the weakest services performance in 4 months. Of course, "weather" is blamed and optimism for the future remains but what was odd to us is that economists claim that in February manufacturing returned to normal... but clearly services did not.

 

The overall index plunged...

 

The employment sub-index slowed notably...

 

Commenting on the Services PMI data, Chris Williamson, Chief Economist at Markit said:

The unusually severe winter weather undoubtedly looks to have taken its toll on the economy in the first quarter. Over the first two months of the year, the manufacturing and services PMI surveys are signalling an annualised growth rate of just 1.6%, which represents a halving of growth compared to the 3.2% pace seen in the fourth quarter.

 

Payroll growth in the vast services economy also weakened alongside the disruptions to business activity, hitting the weakest for almost a year. However, companies clearly remained in expansion mode, with just over half of all firms expecting activity to rise over the coming year against just 3% expecting a decline.

But this is what he said about the US Manufacturing data just last Thursday which printed so positively...

The flash manufacturing PMI provides the first indications that production has rebounded from the weather-related slowdown seen in January. Having slumped to a three-month low in January the PMI surged to its highest for almost four years in February, as companies reported business returning to normal after freezing temperatures and snow disrupted operations and supply chains.

so in February, Manufacturing returned to normal (not affected by weather?), but services not so much...

Credibility?

 

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Mon, 02/24/2014 - 10:21 | 4470522 NoDebt
NoDebt's picture

You know, if you drive enough companies out of business, they won't be available to tell these survey monkeys how bad things are any more.

Addition by subtraction.  AKA winning, DC style.

Mon, 02/24/2014 - 10:32 | 4470579 Headbanger
Headbanger's picture

Yeah eventually all that will be left in the services PMI.are the hookers.

Mon, 02/24/2014 - 10:22 | 4470533 katwoman
katwoman's picture

Seriously, how do they write this stuff knowing what they wrote contrary not even a week ago.

Mon, 02/24/2014 - 10:30 | 4470571 Theta_Burn
Theta_Burn's picture

I know right..

But it appears more professional than obama at every other sound bite a few yrs ago uttering "green shoots"

Mon, 02/24/2014 - 10:28 | 4470561 NDXTrader
NDXTrader's picture

None of it matters. The European wing of ZH believes in the scam called "Global Warming". We are all doomed

Mon, 02/24/2014 - 10:33 | 4470585 yogibear
yogibear's picture

The more companies layoff and people fall off unemployment insurance the more bullish the market gets.

Mon, 02/24/2014 - 10:39 | 4470614 Caracalla
Caracalla's picture

Another instance of real facts not mattering a bit....another reason to just BTFD

Mon, 02/24/2014 - 11:37 | 4470916 papaswamp
papaswamp's picture

Notice the trend...continued degradation.

Mon, 02/24/2014 - 15:03 | 4471787 Law97
Law97's picture

Stop trying to make sense of the market.  The market just goes up, up, up, and the so-called "experts" must try to proivide some smart-sounding explanation. 

 

The market is going up and fundamentals have nothing to do with it. 

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