Non Manufacturing ISM Crashes To Lowest Since February 2010, New Orders Devastated To July 2009 Levels

Baffle with BS continues: just as the June Mfg. ISM predictably beat two days ago, so today's Non-mfg ISM missed, printing at 52.2 below expectations of a 54.0 and down from 53.7. This was the lowest print since February 2010, and the biggest miss to expectations since April 2010. The New Order components was absolutely destroyed printing at 50.8, down from 56.0, and the lowest since July 2009. Furthermore, Business Activity tumbled from 56.5 to 51.7, far below consensus of 56.8, and the lowest since November 2009. The only good indicator on the face of this absolute devastation was the Employment index which mysteriously rose by 4.6 to 54.7, the highest since February: those part-time jobs must sure be accretive to businesses.

The collapse in its full glory:

Full breakdown:

From the report:

The report was issued today by Anthony Nieves, C.P.M., CFPM, chair of the Institute for Supply Management™ Non-Manufacturing Business Survey Committee. "The NMI™ registered 52.2 percent in June, 1.5 percentage points lower than the 53.7 percent registered in May. This indicates continued growth at a slightly slower rate in the non-manufacturing sector. The Non-Manufacturing Business Activity Index registered 51.7 percent, which is 4.8 percentage points lower than the 56.5 percent reported in May, reflecting growth for the 47th consecutive month. The New Orders Index decreased by 5.2 percentage points to 50.8 percent, and the Employment Index increased 4.6 percentage points to 54.7 percent, indicating growth in employment for the 11th consecutive month. The Prices Index increased 1.4 percentage points to 52.5 percent, indicating prices increased at a faster rate in June when compared to May. According to the NMI™, 14 non-manufacturing industries reported growth in June. Respondents' comments are mixed about business conditions depending upon the industry and company. The majority indicate that growth has been slow and incremental; however, it is still better year over year."

The always entertaining respondents:

  • "Lower revenues due to healthcare reform, causing pressure to cut costs and headcount." (Health Care & Social Assistance)
  • "Business is steady, but profitability is coming from cost savings measures. Some divisions expected to be flat or slightly below expectations." (Professional, Scientific & Technical Services)
  • "Sales increased slightly again for the fourth consecutive month over last year's sales for the same period. Hiring increased slightly as well." (Public Administration)
  • "Business environment certainty continues to stabilize. Effects on our business lag. We expect as housing and building continue to improve, we will see gains." (Management of Companies & Support Services)
  • "Slow growth — intense downward price pressure from customers." (Wholesale Trade)
  • "The roller coaster ride is not over yet. Customer counts are well below expectations, but overall revenue is higher than expected. The fluctuations are significant, week to week as much as YTD, resulting in problems with accurate forecasting." (Arts, Entertainment & Recreation)

And the punchline from the report: 

  • Helium is the only commodity reported in short supply.

Sure is....