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Just 90 minutes after the U.S. Labor Department had issued materially better employment metrics than had been expected, the Institute for Supply Management (ISM), the Tempe, Arizona-based trade group reported that its survey on non-manufacturing activity had shown a notable slowdown in April.

Specifically, the ISM index came in with a reading of 53.1. That was above the 50.0 dividing line between a services sector that is expanding and one that is contracting. However, this metric, while in expansionary territory for a 40th straight month, improved by less than in March (54.4) and also increased by less than had been expected. Consensus had been for a reading of 54.0.

In addition to the overall score, we saw somewhat lesser rates of improvement in new orders (54.5 in April versus 54.6 in March), employment (52.0 versus 53.3), prices (51.2 versus 55.9), and backlogs (51.5 versus 54.5). On the other hand, inventories accelerated their gain, as did inventory sentiment. Meanwhile, no areas exhibited a decline in activity last month, that is a reading below 50.0.  

As to the aggregate result, the 53.1 score was below the 12-month average of 54.4. The range for the past year has been 52.7 to 56.0. The 53.1 result was also the lowest reading since last July, when the ISM had recorded a result of 52.9. This latest survey was better than the companion ISM issuance released on Wednesday on manufacturing activity, which had seen a barely increasing score of 50.7 in April.

Finally, comments by respondents featured observations that business in transportation and warehousing appeared to be on the upswing, but that there was no real change in public administration in the latest month, while the arts, entertainment, and recreation categories saw further fluctuations.

On the whole, this was a somewhat disappointing result, but while it is an important survey, the major focus of investors today is on the better-than-expected employment report issued earlier today.

At the time of this article's issuance, the author did not have positions in any of the companies mentioned.