Growth in global services held steady at a very healthy 55.5 in May versus April's 55.4. Export orders jumped 1.7 points to 53.8, which is very strong for this reading. New business at 55.4 is also very strong as is business activity (output) at 55.5. All this strength did not heat up prices any further as inputs eased back 1.2 points to a still elevated 59.5 while prices charged edged 1 tenth lower to 56.1.

Breadth of strength is also a positive with all six industry groups, led by financial services, showing growth. India and China led the country rankings with the US and Japan also strong.

This report isn't a surprise given the previously released country data for May but it does highlight the acceleration underway in global services.

JP Morgan Global Services PMI gives an overview of the global services sector. It is based on monthly surveys of over 5,500 executives from 15 of the world’s strongest economies, including the U.S., Japan, Germany, France and China which together account for nearly 80 percent of global services sector’s gross value added (GWA). It reflects changes in global output, employment, new business, backlogs and prices. The Global Services PMI is seasonally adjusted at the national level to control for varying seasonal patterns in each country and is produced by J.P. Morgan and Markit in association with ISM and the International Federation of Purchasing and supply Management (IFPSM).

Investors need to keep their fingers on the pulse of the economy because it dictates how various types of investments will perform. The J.P. Morgan Global Services PMI provides advance insight into the global services sector, which gives investors a better understanding of business conditions and valuable information about the economic backdrop of global 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. The PMI data are also used by many Central Banks to help make interest rate decisions.

The JP Morgan Global Services PMI data give a detailed look at the manufacturing sector, how busy it is and where things are headed. Since the services sector accounts for the lion’s share of GDP of many advanced economies, this report has a big influence on the markets. In addition, its sub-indexes provide a picture of global output, employment, new business, backlogs and prices.