The US service sector activity had fell to a six-month low in January, as investors were worried about the effect of a record 35-day long federal government shutdown.
Despite a solid reflection of moderation in activity for the second straight month, the institute of supply management’s report revealed on Tuesday, the 5th of February, 2019, had indicated a solid economic growth, as the American dollar had remained riant on Tuesday’s market, gaining against all of the seven major currencies, alongside emerging market currencies as well.
Apart from that, a robust job data and fresh enthusiasm over progress on US-China trade talk had extended the gains of Wall St. When this report is being prepared, February the 5th, GMT.
20.30, the US stocks were upbeat, while the S&P 500 secured a gain of 0.37 percent to 2,734.83 and the Dow Jones Industrial Average surged over 0.60 percent to 25,394.10. Citing statistics from ISM (Institute of Supply Management), the non-manufacturing index drained 1.3 points to 56.7 last month, which was its lowest figure since July, 2018.
Multiple analysts had been considering this steep decline as a sign of global contraction as well, since a reading above 50.0 indicates an expansion in the sector. More crucially, since the service sector accounts for over two-thirds of United States’ economic activity, a senior economist at BMO Capital Markets in Toronto, Jennifer Lee said, “This was clearly a disappointing non-manufacturing reading, aggravated by a number of factors, one of which was temporary.
We anticipate a retracement of this setback in February, but that temporary factor may return to the fore. ”