The global composite index for July fell to 52.3, 0.4 points less than June (52.9). This is the 9th month in a role that the global composite is above 50, signaling business expansion. However, July is still the weakest expansion since April this year.

With the exceptions of Germany, France, and Australia, all registered nations saw an output growth. Growth was led by India, followed by Brazil, and then the US. The UK, Brazil, and Kazakhstan had faster rates of increase while Japan and Russia returned to expansion following recent contractions. On average, growth slowed to a near-stagnant pace across the Eurozone.

The global service index rose to 53.3, 0.2 points greater than June (53.1) and extending a year-and-a-half streak of expansion. All of the nations for which data were available signaled growth, including the US, UK, and, the Eurozone. Rates of increase were higher in China, the UK, Brazil, and Kazakhstan. India saw the quickest expansion, while Japan and Russia returned to growth following recent contraction. Global service sector employment rose for the third straight month and at the fastest pace since June 2023.

Input price inflation accelerated to a 10-month high in July. Part of the increase in costs was passed on to clients in the form of higher charges. However, inflation in selling prices eased to the weakest since October 2020. Business optimism regarding the year ahead dipped to an eight-month low, remaining below the survey's long-run average. However, the rate of expansion in global manufacturing remained below the service sector.

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.