Yahoo Finance ISM services index comes in lower than expected for month of May
With the release of the May ISM services index coming in lower than expectations, Yahoo Finance Live breaks down what the data is saying.
Video transcript
BRAD SMITH: Now we've got some breaking news ISM services. Julie?
JULIE HYMAN: Yeah, the services economy in the US actually not as high last month. 50.3 is the reading. 50 remember is the dividing line between contraction and expansion. So just on that knife's edge, if you will and down from 51.9 in April. The expectation for this number was 52.4. So in other words, services reading was expected to go up by economists, and instead it has gone down.
The prices paid component coming down a little bit from the prior month to 56.2. Employment also now below that 50 level at 49.2, and new orders at 52.9. So interesting to see this number here. I'm just going through the release here to see what else sort of stands out here.
11 industries reporting growth in May it looks like. And there has been a pullback in the rate of growth for the services sector-- that's the chief economist there pointing that out here-- due mostly to a decrease in employment and continued improvements in delivery times, which results in a decrease in the supplier deliveries index. Brad?
BRAD SMITH: Yeah, it's going to be interesting to see how the Fed and even the meeting minutes that will come forward after their next June meeting, how they're discussing services inflation and where they believe that they still have to do more work to combat that even looking at the numbers that have come out today. But even more so, as we're looking at the market action here, the Dow getting back into positive territory, things have been relatively flat. So not really moving a ton on this, but at least as of right now, we're seeing a trifecta of green across the major averages.
JULIE HYMAN: Yeah, and just to mention, we also got the S&P read on the same thing a little bit earlier. The final read for May coming in at 54.9. So also a little bit lower there than the initial read.
