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U.S. services sector activity accelerates in June: Markit
July 3, 2014 / 1:50 PM / 3 years ago

U.S. services sector activity accelerates in June: Markit

NEW YORK, (Reuters) - The final reading for activity in the U.S. services sector hit its highest in 4-1/2 years, pushed higher by increasing new business activity and hiring, a survey showed on Thursday.

Detroit firefighters try to contain a fire at a shed in Detroit, Michigan December 3, 2013. Firefighters suspect the fire to be arson. REUTERS/Joshua Lott

Financial data firm Markit said its final services Purchasing Managers Index hit 61.0 in June, the highest final reading since the survey began in October 2009, compared with May’s final reading of 58.1. It was slightly lower than the 61.2 preliminary print.

A reading above 50 signals expansion in economic activity.

The services sector added employees at the fastest rate on record with the employment index coming in at 56.1, higher than the 55.4 preliminary reading. Last month’s final read came in at 52.8.

A waiter serves dessert to a table of men listening to Chinese millionaire Chen Guangbiao during a lunch he sponsored for hundreds of needy New Yorkers at Loeb Boathouse in New York's Central Park June 25, 2014. REUTERS/Lucas Jackson

The new orders subcomponent also hit its highest on record.

Markit’s final composite PMI, a weighted average of its manufacturing and services indexes, hit 61.0 in June, also a record high for a final reading, versus 58.4 in May and a preliminary 61.1.

“Companies reported that business confidence remains high, which is in turn feeding through to increased business investment and hiring,” said Chris Williamson, chief economist at Markit.

“The increased growth of new orders meanwhile suggests hiring intentions will remain strong in the third quarter.”

He said economic growth in the second quarter could come in at an annualized rate close to 4 percent.

Reporting by Rodrigo Campos; Editing by Chizu Nomiyama

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