The service industries from US reported a small victory in January, by slowing at a slower pace than forecasted. The Institute for Supply Management’s index of non- manufacturing businesses, which compose almost 90 percent of the economy, increased to 42.9 from 40.1 in December. Figures below 50 signal a contraction.
This could indicate a turning point in the natural curve of those industries.
A record spending slump has forced retailers including Macy’s Inc. and Starbucks Corp. to cut thousands of jobs, contributing to deterioration in confidence that’s likely to prompt further withdrawals.
But this does not mean that the news are good. U.S. companies cut only in January more than half a million jobs, out of which more than half came from the dominating services sector. Some commentators said that the economy will not be stabilized “until we see employment start leveling off to where it’s not in that freefall”.
Federal Reserve policy makers last week voted to keep the benchmark overnight lending rate between banks in a range of zero to 0.25 percent and said there was a “significant’ risk the economy would not recover until 2010.
Following the announcement, the shares of the services sector showed a modest growth of 0,74% today. Biggest gainers in the sector today were CB Richard Ellis Group, (CBG) +15,82% and Jones Lang LaSalle (JLL) +15,02%, which were the companies who had missed the least their forecasts.