The Institute for Supply Management commented: “The decrease in the composite index in June is a result of notably lower business activity, a contraction in new orders for the second time since May 2020 and continued contraction in employment.”
Today, traders also had a chance to take a look at the final readings of S&P Global Services PMI report. The report indicated that S&P Global Services PMI increased from 54.8 in May to 55.3 in June, compared to analyst consensus of 55.1.
Factory Orders declined by 0.5% month-over-month in May, while analysts expected that they would grow by 0.2%.
U.S. Dollar Index pulled back towards the 105.00 level as traders reacted to the weaker-than-expected ISM Services PMI report. The surprising weakness in the services sector may provide the Fed with an opportunity to start cutting rates sooner than previously expected.
Gold moved above the $2350 level and is trying to settle above $2365 as traders focus on U.S. dollar’s pullback and falling Treasury yields.
SP500 tested session highs near the 5530 level after the release of the report. Stock traders remain bullish despite the weak report as they focus on falling Treasury yields and hope that Fed will start the rate cut cycle.
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