U .S. Service Sector Accelerates In February: 5 Big Winners
Zacks Investment Research | Mar 05, 2020 10:36PM ET
On Mar 4, the Institute for Supply Management (ISM) reported that the U.S. non-manufacturing sector grew at the fastest pace since February 2019. ISM’s non-manufacturing index soared to 57.3% in February, above the consensus estimate of 54.9% and January’s figure of 55.5%.
The data indicated expansion of the services sector, which accounts for more than two-thirds of U.S. economic activity. In fact, respondents of the survey expressed their worries regarding the impact of the coronavirus outbreak on the supply chain. However, they remain positive about present business conditions and the overall economy due to the continued growth of the non-manufacturing sector.
Overall, out of 18 non-manufacturing industries surveyed by the ISM, 16 reported growth in February. The accommodation and food services industry grew the most, followed closely by management of companies and support services; mining; finance and insurance; real estate and leasing.
In fact, the service sector also reported strong growth in export orders in February, which rose 55.6% compared with the January reading of 50.1%. Additionally, there has been a 6.9% gain in the New Orders Index that soared to 63.1%, compared with January’s reading of 56.2%.
With the unemployment rate nearly at 50-year low, many respondents stated that “a shortage of workers at several levels is impacting the quality of employees we are looking to hire for capital projects we need to start.”
However, the employment index continued to grow, rising 2.5% last month to 55.6%, compared with January’s reading of 53.1%.
5 Stocks to Buy
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