US Services Sector Dips On Weak Employment (Or Surges Back Near Record Highs)

Following Manufacturing PMI's drop, US Services PMI dipped modestly (though beat expectations). However, under the covers is a big problem as 'employment' plunged to its lowest reading since June 2017

Additionally, from Markit, is the fact that November saw the weakest rise in composite new orders in 13 months.

And then there is ISM's data - which for Manufacturing was 180 degrees from Markit's.

ISM Manufacturing upticked in November, and so did ISM Services!

So there you have it America - Markit says Manufacturing and Services dropped, ISM says they rebounded to near-record highs


The non-manufacturing index rose to 60.7, an Institute for Supply Management survey showed Thursday. That compared with estimates for a decline to 59. The advance was led by business activity and new orders, while a gauge of inventories rose for a third month.

So ISM sees new orders rising but Markit sees it plunge?

However, ISM's report also indicated that continuing trade tensions and easing global growth are affecting service providers, a trend weighing on investors' perceptions of the economic outlook. Export orders decelerated by the most since May while a measure of imports rose the most since March.

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

"... and continuing to add jobs in impressive numbers. Although some cooling in the rate of job creation was seen in November, the surveys are still pointing to payrolls growing at monthly rate of around 185,000.

“The surveys therefore add to evidence that the domestic economy remains in good health, generating balanced growth across both manufacturing and services and increasingly outperforming other major economies.

“However, while new business growth remained encouragingly resilient, it has eased to the lowest in over a year as demand showed some signs of softening, linked partly to growing concerns over trade wars, slower global demand growth, rising political uncertainty and tighter financial conditions. Such concerns have also dampened business expectations about the year ahead, adding to signs that growth may have peaked, though any slowing in growth looks likely to be only modest.”

And finally, Williamson notes that

“The PMI surveys paint a picture of an economy growing at a solid annual rate of 2.5% so far in the fourth quarter..."

Take your pick America!