Main U.S. equity indexes green; Dow out front, up ~0.6%
Materials lead S&P sector gainers; Utilities weakest group
Euro STOXX 600 index up ~0.6%
Dollar edges up; U.S. crude dips; gold rises ~1.5%; bitcoin rallies >6%
U.S. 10-year Treasury yield rises to ~4.73%
U.S. composite PMI hits four-year high
Data geeks were tossed one piece of meat to gnaw on at the end of a relatively sparse week for economic indicators.
And it's generally good news.
Business activity in the United States has continued to expand in August, at a slightly faster pace than the prior month.
S&P Global's advance "Flash" August purchasing managers' indexes (PMI) showed the manufacturing side USMPMP=ECI unexpectedly shed 0.7 point to 53.2, instead of staying put at 53.9.
But the services sector USMPSP=ECI made up for the mild factory slowdown by jumping 2.2 points to print at a robust 56.8, which was 2.8 points north of consensus.
Taken together, the composite measure USPMCF=ECI gained momentum, rising to 56.0 from 54.5, its fastest pace in four years.
All metrics are comfortably above 50, the PMI dividing line between contraction and expansion.
But while this marks the fourth straight month of overall improved business activity growth, it's also the third consecutive monthly deceleration on the factory side, which can be "blamed in part on reduced inventory building and supply delays," according to S&P Global's press release.
On the other hand, jobs were added at the fastest rate in a year and a half, and growth expectations hit a nine-month high.
And while selling prices moderated, input prices—an inflation predictor—remained elevated.
"As reduced safety stock building and supply delays dampen factory production growth, the service sector is now playing a key role in driving a sustained U.S. expansion, underscoring a dependency on consumer spending and financial services growth," writes Chris Williamson, S&P Global's chief business economist.
"Jobs growth has also shown a welcome revival in August, with employers gaining in confidence as concerns fade over the negative economic impacts of tariffs and the conflict in the Middle East," Williamson adds. "However, the latter in particular remains a key area of concern for businesses, especially via the impact on supply lines and energy prices."
SPY•
