The services sector expanded in August, according to the latest ISM Services PMI data. The reading was 51.5, just slightly better than the 51.4 reading from July. Wall Street had also been looking for 51.4. The employment index fell, while new orders rose.
Catalysts anchors Madison Mills and Brad Smith break down the data in the video above.
For more expert insight and the latest market action, click here to watch this full episode of Catalysts.
This post was written by Stephanie Mikulich.
But first, we're going to get to that economic data crossing the wire here. ISM services PMI seeing a level of 51.5. That is for the ISM services data. Economists were expecting 51.4, so coming in just a smidge hot there for that. Prices paid also coming in a smidge hot at 57.3 versus the previous number of 57. Employment though, coming in just a bit soft at 50.2. The previous number you got there was 51.1. New orders though, coming in a little bit hot at 53. The previous number was 52.4. I do want to flip our board over to the treasuries, if we can, guys, because it's interesting to see the treasury market's reaction to this economic data. You're seeing a little bit of pressure across the yield curve here and it's interesting to me, Brad, because it indicates just how low the bar is for the bond market right now in terms of reactions to the economic data that we are getting in. And it seems to me like the market is viewing this this services ISM data coming in here as a potential positive catalyst moving forward and potentially adding to the idea that the Fed could go for 50 as opposed to 25 as we head into that next meeting.
Yeah, earlier this week, goods in continued contraction. And right now, as you're seeing here, the reading in August marking the sixth time that the services composite index has been an expansion territory in 2024. So that gives you a little bit more inclination around where spending is continuing to move and as well how this could flow through to the jobs market. Of course, we'll get a little bit more of that data. We got some of it on the ADP private payrolls front this morning. Came in weaker than expected. Weakest print that we've seen since 2021. And of course, we get the all-important BLS, the Bureau of Labor Statistics, as you know, tomorrow, Friday. Uh and we'll see exactly where that continues to push the Fed in their own commentary around where they need to insert even more policy as the markets are anticipating that first rate cut come mid-September here.
Yeah, we've got markets hitting session highs on the heels of that economic data as well.