ISM Services Report “Collapses”


“It’s not that it’s weak.  It’s a complete collapse in the number, one of the lowest readings this statistic has ever had.”

Jim Paulsen (subscription required), Chief Investment Strategist, Wells Capital Management

Recession talk is in the air again this morning as a dreadful ISM Services Report for January appears to have shattered the recent optimism.  The report’s index of Business Activity/Production fell to 41.9 from 54.4 in December.  The overall number was below 50, signalling a contraction in economic activity, for the first time since August 2003 (ISM Non-Manufacturing Report, January).

Stock markets are getting crushed: Dow -298, Nasdaq -54, S&P -34.

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