Recovery on track but slows in November, U.S. data shine
By Rodrigo Campos and Jonathan Cable
NEW YORK/LONDON (Reuters) - Service sector activity expanded around the world in November, albeit at a slower rate, while strong U.S. data housing and jobs figures brightened the outlook for growth, data showed on Wednesday.
Sales of new U.S. single-family homes recorded their biggest increase in more than three decades in October, and private job creation rose by the most in a year last month. The U.S. services sector expanded, though the pace of growth slowed last month with employment and business activity expanding at lower rates.
The initial U.S. market reaction to the strong jobs data reflected concern over a possible reduction in asset purchases from the Federal Reserve, a stimulus program that has boosted equity prices and has kept a lid on Treasury yields.
The upbeat housing data turned the stock market around later in the session, and Wall Street shaved its initial losses.
"In the short term the market is still worried about the most inevitable thing in our lifetime, and that is tapering," said Mike Serio, regional chief investment officer at Wells Fargo Private Bank in Denver.
"However, this (jobs) number, we don't want to get too excited about it, but it truly was a pretty darn good number."
Private employers added 215,000 new jobs to their payrolls last month, the ADP National Employment Report showed, beating economists' expectations for a gain of 173,000 jobs. October's gain was revised to 184,000 from 130,000.
Financial data firm Markit said its U.S. composite Purchasing Managers Index (PMI) - a weighted average of its manufacturing and services indexes - rose to 56.2 last month from 49.6 in October, while The Institute for Supply Management said its services index fell to 53.9 last month from 55.4 in October. Continued...