The global services PMI rose to 54.1 in May from 52.7 in April after holding in a low 50s range the last several months. The May reading, the highest in the last 12 months, reflected rising new orders and job growth.

New orders improved to 53.3 in May from 52.2 in April while export orders came in at 51.0 in May versus 51.2 in April. Future activity remained robust at 64.2 in May, up from 63.3 in April. Employment turned positive at 51.1 versus 49.8 in April. Prices received were unchanged at 53.8.

Regional details are limited in the services report but India seems to be leading again. These results together with the May manufacturing PMI of 50.9 leave the global composite at a 12-month high of 53.7.

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.