This article was originally published on ETFTrends.com.
The Institute for Supply Management released a report on Thursday that revealed a growth increase in U.S. service sector activity--a pace that was higher than expected in the month of August. According to the ISM, its non-manufacturing index jumped to 58.5 during the month of August--about three points higher than the previous month.
"There was a strong rebound for the non-manufacturing sector in August after growth 'cooled off' in July," said Anthony Nieves, Chair of the ISM Non-Manufacturing Business Survey Committee. "Logistics, tariffs and employment resources continue to have an impact on many of the respective industries. Overall, the respondents remain positive about business conditions and the economy."
The survey also revealed that 16 of 17 services sectors reported growth during the month of August, which was led by construction, transportation, retail trade and educational services. The general sentiment by the companies surveyed was positive, but the risks of tariffs between the United States, China and the EU were still on many of their minds.
Nonetheless, the companies responding to the survey "remain positive about business conditions and the economy," said Nieves, chair of the ISM's services committee.
Countering this report was the Commerce Department releasing data that showed factory orders for July falling 0.8%, which was greater than the 0.6% decline that was to be expected according to a survey of Thomson Reuters analysts. Data the previous month showed an increase of 0.7%.
Investment-Grade Bond ETFs Jump
LQD seeks to track the investment results of the Markit iBoxx® USD Liquid Investment Grade Index composed of U.S. dollar-denominated, investment-grade corporate bonds. LQD allocates 95 percent of its total assets in investment-grade corporate bonds to mitigate credit risk.
VCIT seeks to track the performance of a market-weighted corporate bond index with an intermediate-term dollar-weighted average maturity, namely the Bloomberg Barclays U.S. 5-10 Year Corporate Bond Index. While VCIT holds debt issues with maturities between 5 and 10 years, they are all investment-grade holdings to minimize default risk.
For more trends in fixed income, visit the Rising Rates Channel.
POPULAR ARTICLES FROM ETFTRENDS.COM
- Jeff Sessions Considers Crackdown on Tech Companies
- The Rush is on to Fidelity’s Zero Fee Funds
- Berkshire Hathaway Makes First Direct Investment in India
- BlackRock Seeking to Disrupt ETFs by Rethinking Sector Classifications
- Kevin O’Leary on Choosing to Rent or Buy a House