A little bit deeper contraction for manufacturing (46.3) and a little slower expansion for services (54.1) are the results of June's PMI flashes.

Manufacturing respondents reported the deepest contraction so far this year in new orders which points to general trouble for this sample in July. In contrast, services respondents reported what the report describes as a"robust" rate of new orders in line with prior months.

Services did, however, report slowing in employment reflecting difficulty in finding replacements for job leavers. Manufacturers reported slower job creation in line with a"substantial" decline in backlog work.

Optimism among the manufacturing sample is the lowest this year again in contrast to services where optimism is at the highest level since May last year.

Higher wages are driving up costs for service providers. Otherwise price results and commentary were flat.

These results are starkly mixed and leave Econoday's Consensus Divergence Indexes at 10 overall and also at 10 when excluding prices, readings indicating, on net, no more than modest outperformance for the US economy and do not yet signal a near-term rate hike by the Federal Reserve.

No significant change is seen in June compared to May; manufacturing underperforming at 48.5 and services leading the way at 53.5.

The flash Composite Purchasing Managers' Index (PMI) provides an early estimate of current private sector output by combining information obtained from surveys of around 1,000 manufacturing and service sector companies. The flash data are released around 10 days ahead of the final report and are typically based upon around 85 percent of the full survey sample. The report tracks changes in variables such as new orders, stock levels, employment and prices across both manufacturing and services. Production is also tracked, defined as"production" for manufacturing and"output" for services. Results are synthesized into a single index which can range between zero and 100. A reading above (below) 50 signals rising (falling) output versus the previous month and the closer to 100 (zero) the faster output is growing (contracting). The report also contains flash estimates of the manufacturing and services PMIs. The data are produced by S&P Global.

Investors need to keep their fingers on the pulse of the economy because it dictates how various types of investments will perform. By tracking economic data such as the purchasing managers' manufacturing indexes, investors will know what the economic backdrop is for the various markets. The stock market likes to see healthy economic growth because that translates to higher corporate profits. The bond market prefers less rapid growth and is extremely sensitive to whether the economy is growing too quickly and causing potential inflationary pressures.