S&P hits record high as US firms grow at fastest rate for four years

THE US private sector’s output grew at the fastest pace in four years this May, according to a major survey of businesses, indicating that the economy has picked up momentum from a lull at the start of the year.

The S&P 500 hit a record high during the day, jumping above 1,910 and closing up at 1,911.

Markit’s purchasing managers’ index (PMI) for US services yesterday came in at 58.4, jumping from April’s reading. Combined with earlier figures for factories, firms are reporting the strongest output growth since April 2010. A score over the neutral 50 mark points to rising activity.

“The pendulum appears to be swinging towards firmer economic growth into the summer months,” said Markit senior economist Tim Moore. Unexpectedly cold weather slowed down the US recovery during the first three months to just 0.1 per cent GDP growth.

New business growth for services alone saw the fastest month-on-month acceleration since Markit began recording the figures in 2009.