It is only logical that the catalyst that has pushed the entire market higher, that would be the "all critical" Spanish Service PMI which soared very credibly a few short hours ago, would be doubled down when its US cousin came out. Sure enough, moments ago the Institute for Supply Management revealed [5]that the February non-manufacturing ISM declined from 55.7 to 55.2, but was just above the expected 55.0, which was enough to send the headline scanners into full blown liftathon mode and the S&P to intraday highs. Ignored was that the key New Orders series actually declined from 58.3 to 54.4, yet offset by a jump in Employment from 55.3 to 57.5. What was amusing was the jump in New Export Orders to 55.5 from a contractionary reading. We can't wait to learn just whom the US is exporting its mission critical services to these days. Finally, and perhaps most relevant, was one of the healtcare related respondents who said the truth, the whole truth and nothing but the truth on the issue of Obamacare: "Healthcare reform causing continued slowdown and less investment." That's only the beginning.
The pretty chart:
[6]
The often tracked New Orders less Inventories chart:
[7]
Full Non-Mfg ISM data table:
[8]
And finally, the full respondents, which as always never share the optimism conveyed by the headline:
- "Healthcare reform causing continued slowdown and less investment." (Health Care & Social Assistance)
- "Sales are up slightly compared to this same period last year. This is offset by slight increases in costs for personnel benefits, fuel and other operating costs." (Public Administration)
- "Business is good, but we find ourselves in a very competitive environment." (Construction)
- "No change in business levels since prior month, but optimism growing that commercial and industrial construction will experience growth in 2013." (Real Estate, Rental & Leasing)
- "Seeing increasing prices on services and goods — some not substantiated. Business outlook continues to show small signs of improvement in parts of our business, but other parts are lagging behind." (Professional, Scientific & Technical Services)
- "There seems to be some stabilization in recent months. Business seems a little more confident, and consumers are participating once again." (Retail Trade)
- "Business is slightly softer than this time last year, but there are a lot of projects on the horizon which gives us confidence." (Wholesale Trade)