Today's Report (11/03/2021)

Markit Services PMI

The seasonally adjusted final IHS Markit US Services PMI Business Activity Index registered 58.7 in October, up from 54.9 in September and above the earlier released 'flash' estimate of
58.2. The latest expansion was sharp overall and the quickest since July. The upturn was faster than the series average, with firms linking the increase to greater client demand and a further rise in new business.

October data signaled a strong rise in new orders at service providers, with the pace of growth quickening to a three-month high. Companies stated that demand from new and existing customers helped boost new sales. At the same time, some firms noted that greater confidence at clients alongside the return to the office for some customers supported the upturn.

Markit Composite PMI

The IHS Markit US Composite PMI Output Index* posted 57.6 in October, up from 55.0 in September to signal the fastest rise in private sector output since July. Although manufacturing production continued to be constrained by supply issues, the overall expansion was supported by a sharper service sector upturn.

Contributing to the overall expansion was a faster increase in new business. The rise was supported by sharp upticks in new orders at services providers and manufacturers. Foreign client demand fared less well, however, as goods producers registered only a fractional expansion and service sector firms saw a further contraction.

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US Markit Services PMI

What is it?

The Service PMI release is published monthly by Markit Economics. The data are based on surveys of over 400 executives in private sector service companies. The surveys cover transport and communication, financial intermediaries, business and personal services, computing & IT, hotels, and restaurants.

An index level of 50 denotes no change since the previous month, while a level above 50 signals an improvement, and below 50 indicates a deterioration. A reading that is stronger than forecast is generally supportive (bullish) for the USD, while a weaker than forecast reading is generally negative (bearish) for the USD.

US Markit Composite PMI

What is it?

The PMI monthly Composite Reports on manufacturing and services.

How does it affect the markets?

CURRENCY - Typically with a release of 50 or higher the dollar might bounce higher as it suggests the economy is doing well and inflation is in check

STOCKS - The Equity market generally reacts positively to a rising PMI, however, if the economy is already in a high gear it could suggest an overheating economy and the Federal Reverse might boost interest rates to cool business activity

BONDS - A release consistently above 50 is typically viewed as bearish for fixed incomes because if the economy is also into an expansionary phase it could aggravate inflation and invite higher interest rates.