Markit manufacturing and services surveys for the US:
- Prior was 51.1
- Services 51.0 vs 51.0 expected
- Prior services 50.9
- Composite PMI 51.2 vs 51.0 prior
This is some good news in a forward-looking indicator. It remains soft but it's showing signs of stabilization or a bounce. That might reflect the better tone in October on the trade war.
Some details from the manufacturing report:
- Output 52.7 vs 51.8 prior
- New orders 52.5 vs 51.5 prior
Services:
- New business 50.0 vs 50.6 prior -- lowest since 2009
There is some angst about softness in labor indicators in this report: Commenting on the flash PMI data, Chris Williamson, Chief Business Economist at IHS Markit, said:
"Despite business activity lifting from recent lows, the survey data point to annualized GDP growth of just under 1.5% at the start of the fourth quarter, and a near-stalling of new order growth to the lowest for a decade suggests that risks are tilted toward growth remaining below trend in coming months.
"An increased rate of job culling adds to the gloomy picture, with jobs being lost among surveyed companies at a rate not seen since 2009. At current levels, the survey's employment gauge indicates non-farm payroll growth slipping below 100,000.
"The overall subdued picture reflects a spreading of economic weakness from manufacturing to services, but encouragingly we are now seeing some signs of manufacturing pulling out of its downturn,in part driven by a return to growth for exports and improved sentiment about the year ahead, linked to hopes that trade war tensions are starting to ease.
"If manufacturing can continue to gain momentum this should hopefully feed through to stronger jobs growth and an improved service sector performance, leading to better GDP growth, but it remains too early to determine whether the economy has truly turned a corner."
