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01 06 2016 | by Victor Xing | Economics

December ISM Non Manufacturing Index

December ISM Non Manufacturing Index came in at 55.3 vs. 56.0 consensus.  The latest data indicated that growth in the U.S. services sector remain robust despite continued weakness in the manufacturing sector (seen in the ISM Manufacturing Index on Jan 4th, which came in at 48.2 vs. 49.0 expectations).

Sub-components of the report are encouraging.  The highly-watched Employment index rose a touch, but it is still below the multi-year high of 59.6 in July 2015

  • Business Activity at 58.7 vs. 58.2 prior
  • Prices remain subdued at 49.7 vs. 50.3 prior (pass-through effect of tepid goods inflation)
  • New Orders rose to 58.2 vs. 57.5 prior
  • Employment inched higher to 55.7 vs. 55.0 prior
  • Aggregate composite at 55.3 vs. 55.9 prior
ISM Non Manufacturing Index (major components)
ISM Non Manufacturing Index (major components)
Market participants generally refer to ISM Non Manufacturing Index as an early read on services sector economy, and it can serve as a leading indicator on the upcoming Payrolls report given services sector dominates U.S. employment.

Next article01 05 2016 | by Victor Xing | Capital Markets

Fannie and Freddie’s Credit Risk Transfer Derivatives