The latest numbers on the U.S. economy suggest a mixed picture. While gross domestic product is expected to show a significant increase in the third quarter, other indicators indicate a slowdown in economic activity towards the end of summer.
The S&P flash U.S. services-sector index dropped to a six-month low of 51 in August, down from 52.3 in the previous month. This sector includes industries like health care, retail, and hospitality, which employ a large portion of Americans.
In addition to the decline in the services sector, the S&P U.S. manufacturing-sector index also slipped to 47 from 49. The manufacturing industry, with the exception of carmakers, has struggled due to a shift in consumer demand towards services.
While the service side of the economy has been driving most of the growth, the recent surveys indicate a loss of momentum. However, despite these challenges, the economy has managed to avoid a recession so far.
In response to these developments, the Dow Jones Industrial Average (DJIA) and S&P 500 (SPX) experienced gains in Wednesday's trading session.