Surprise upside in the U.S. ISM nonmanufacturing index - Nomura

Analysts at Nomura offered a review of the surprise upside in the U.S. ISM nonmanufacturing index.

Key Quotes:

"Surprising the market to the upside, the headline index jumped 5.7 points in September to 57.1 from 51.4 (Nomura: 52.0, Consensus: 53.0). Combined with an improvement in business activity suggested by ISM manufacturing survey released this Monday, the sharp September rebound in the nonmanufacturing sector to the level higher than the one recorded prior to the drop in August confirms that the slowdown in August was only transitory.

The pickup in September was broad based. The indicators for business activity and new orders jumped sharply to 60.3 from 51.8 and to 60 from 51.4, respectively. Moreover, the employment activity expanded notably, increasing to 57.2 from 50.7 in the prior month. The new export orders jumped to 56.5, reversing the contraction in August."