ISM Non-Manufacturing

The ISM Non-Manufacturing read for October of 60.1, against estimate of 58.6, is only the fourth time in history with a read above 60.0. There was robust gains across the board, except a marked decline in prices, which is something that merits watching as the Fed continues to try and convince us persistent deflationary pressure is only “transitory.”

• New orders 60.1 from 59.8
• Employment 57.5 from 56.8
• Prices 62.7 from 66.3

Hiring has returned to pre-hurricane levels in October and the previous month read was not as bad as initial reported.  Non-farm payrolls rose by 261,000 and September was revised up to 18,000 from down 33,000. August also increased to 208,000 from 169,000.  A key area of jobs growth was food services and drinking places, which added 89,000 jobs. 

However, average hourly earnings growth remains anemic and was flat in October after rising 0.5% in September.  Average hourly earnings have increased 2.4% year over year.   The unemployment rate declined to 4.1 from 4.2 in September and the labor participation rate declined to 62.7% from 63.1% in September. Overall, the jobs picture does not really do much to dissuade the Fed from raising rates in December, and actually, it may have had a couple points to the camp that believe the Fed will hike then.

The markets are all trading positive territory.  DOW is being propelled by Apple (AAPL).  Overall though decliners are leading advancers 1535/1316 on the NYSE and 1444/1408 on the Nasdaq.

Have a great weekend.