4/7/2015
By Jennifer Coombs

The Institute for Supply Management (ISM) noted that although the manufacturing sector may be soft at the moment, the rest of the economy is relatively strong. ISM’s non-manufacturing reading of the purchasing managers’ index (PMI) posted a strong headline reading of 56.5. This reading came in shy of consensus at 56.7 and the prior month’s reading of 56.9, but still points to a strong expansionary phase in the service sector. New orders were particularly strong at 57.8, as well as backlog orders at 53.5 – both very important readings. The employment component was also very strong at a 5-month high of 56.6. The overall broad strength in the ISM reading is encouraging with 14 of 18 industries surveyed noting growth in March. Management services led the sector to the upside, while construction also noted positive growth during the month. The four weakest industries included mining and education. The strong dollar continues to be in focus as weakness in foreign demand for US goods is putting more of the burden on the US consumer to keep the economy chugging along. However, it appears that with employment trends solid is the ISM non-manufacturing index, consumers are starting to do their part.

Jennifer Coombs
Wall Street Strategies

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