Image Source: Pexels
 

As I indicated yesterday and earlier today, we got some stale data on factory orders this morning, as well as a JOLTS report for November. I’ll take a look at those tomorrow.

In the meantime, the big news of the morning has to be the very good ISM services report for December, which shows that the 75% or so of the economy that is services was nowhere near recession last month. *All* of the components moved in the right direction.

To wit, the headline number increased 1.8 to 54.4, the best number since October 2024 (recall that any number above 50 means expansion):
 

New orders increased sharply, by 5.0 to 57.9, the best reading since October 2024:
 

Employment increased 2.1 from contraction into expansion at 52.0, the best reading since last February:
 

Finally, price paid decreased (which is good) -1.1 to 64.3, still showing lots of price increases, but still the lowest number since last March:
 

I will update this note later today with the three month economically weighted average including the manufacturing sector, but with these numbers it is plain to see that the result is that the economy continued in expansion in December, powered by the services sector.

Further, the ISM services report is in accord with the positive number from ADP this morning, much as the decline in truck sales accords with the continuing contraction shown in the ISM manufacturing report on Monday.

Which means that in Friday’s employment report, I will be looking for a decline in goods-producing jobs, but an increase in service providing jobs.

More By This Author: