The global composite index for October rose to 52.3, 0.4 points more than September (51.9). This is the 12th month in a row that the global composite is above 50, signalling business expansion.

The composite index saw an increase in new business (51.6) with emerging markets showing broad-based expansion with India and Brazil at the top of the growth rankings. China and Russia also saw output increase. Among major developed nations, the US registered the strongest rate of expansion. In the Eurozone area output stabilised while the UK saw moderate growth. Japan contracted for the first time in four months.

The global service index rose to 53.1, 0.2 points higher than in September (52.9) and extending a 21-month streak of expansion. This can be attributed to growth in both new orders (52.7) and new export business (50.7). Employment increased slightly while backlogs made gains. Input prices rose again in September, with the rate of inflation remaining high, leading to an increase in output prices.

Global employment fell with staffing levels decreasing in the US, China, Eurozone area and the UK.

Input price inflation eased to an eight-month low, while output charges rose at the slowest pace seen in four years.

After having fallen to a near-two-year low in September, future expectations rose in October to the highest since May.

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.