This version corrects the manufacturing PMI data which fell to a six-month low of 46.3 in June from 48.4 in the prior month.
The numbers: The S&P Global “flash” U.S. service sector activity index fell to a 54.1 in June from 54.9 in the prior month, a two-month low.
Economists surveyed by the Wall Street Journal has forecast a reading of 53.3.
The S&P Global “flash” U.S. manufacturing sector index, meanwhile, slid to a six-month low of 46.3 from 48.4 in May. Economists had expected a 49 reading.
Readings above 50 signifies expansion; below that, contraction.
Key details: In the services sector, new orders increased at a strong rate in June. The pace of expansion was close to May’s 13-month high.
On the other hand, manufacturers recorded the fastest rate of contraction in new orders since last December. They linked the drop to muted consumer confidence. Foreign client demand was also subdued.
Inflation was seen as moderating. The overall rate of selling prices for goods and services dropped to the lowest level since late 2020.
Big picture: The S&P PMIs try to look ahead at the health of the economy, a critical question with even Federal Reserve officials saying that the outlook for the U.S. is hidden in a fog.
A composite output index from S&P showed the fifth straight month of increases in private sector activity.
What S&P Global said: “The overall rate of expansion of business activity in the
US remained robust in June, consistent with GDP rising at a rate of 1.7% to put second quarter growth in the region of 2%,” said Chris Williamson, chief business economist at S&P Global.
Market reaction: Stocks
DJIA,
-0.65%
SPX,
-0.77%
opened lower on Friday on talk of more interest rate hikes from global central banks. The yield on the 10-year Treasury note
TMUBMUSD10Y,
3.741%
fell to 3.72%.
