Markit's Services PMI missed expectations (55.3 vs 55.5 flash) and dropped from last month - as it seems an easing of the 'weather disruption' did nothing for pent-up services demand. Services employment growth slowed (suggesting a weak NFP) as did new business (very significantly) but optimism rose (so that's good). On the heels of that the ISM Services print missed expectations for the 4th month of the last 5 (53.1 vs 53.6) but rose modestly MoM.
Markit's Services PMI is not the big post-weather bounce everyone was hoping for...
"Service sector business activity rebounded in March after being hit by the adverse weather, and companies have grown more upbeat about the outlook. But hiring remained disappointingly subdued, suggesting firms are reluctant to expand capacity until they see firm evidence of stronger demand feeding through to their businesses."
And ISM Services missed expectations for the 4th of last 5 months with what can only e described as a limp bounce...
The tabular breakdown:
And the respondents, where we find that Obamacare continues to wreak havoc:
- "Outlook remains positive." (Information)
- "Cold weather played more havoc on revenue, causing steep declines
for nearly a week, and then picked up well beyond expectations. Overall,
per capita spending increases, but frequency of visits are down; net
neutral to slightly positive." (Arts, Entertainment & Recreation)
- "Demand is rising; while at the same time there is pressure to reduce staffing expenses." (Finance & Insurance)
- "Healthcare reform continues to adversely impact hospital projected/actual revenue." (Health Care & Social Assistance)
- "Weather in Northeast — lost business days/business travel and site
visits impacted. Energy costs rapidly increasing." (Professional,
Scientific & Technical Services)
- "Business was a little slower than expected due to harsh weather
conditions across much of the country, but we expect a rebound as spring
approaches." (Retail Trade)
- "Economic environment continues to moderate slowly." (Management of Companies & Support Services)
At least everyone agrees that spring follows winter.
This was the biggest bounce in ISM Services employment on record - but only recovered half the "weather" loss...