US: S&P Global Services PMI falls to 51.6 in June vs. 53.5 expected

• S&P Global Services PMI for the US fell sharply in June.
• Major equity indexes in the US trade modestly higher.

Business activity in the US service sector expanded at a very weak pace in early June with the S&P Global Services PMI falling to 51.6 from 53.4 in May. This print missed the market expectation of 53.5.

The report showed that contractions in output and new orders weighed heavily on the headline figure.

Assessing the survey, "having enjoyed a mini-boom from consumers returning after the relaxation of pandemic restrictions, many services firms are now seeing households increasingly struggle with the rising cost of living, with producers of non-essential goods seeing a similar drop in orders," noted Chris Williamson, Chief Business Economist at S&P Global Market Intelligence. "There has consequently been a remarkable drop in demand for goods and services during June compared to prior months."

Market reaction

Despite the disappointing data, Wall Street's main indexes cling to modest gains in the early American session. As of writing, the Dow Jones Industrial Average and the S&P 500 indexes were up 0.35% and 0.3%, respectively.