The numbers: The U.S. economy dropped down to a slower gear in January amid a record outbreak of coronavirus cases that intensified labor and supply shortages, according to pair of IHS Market surveys of senior business executives.
An index of service-oriented companies tumbled to an 18-month low of 50.9 from 57.6 in the final month of 2021, IHS Markit said. A similar gauge of manufacturers dropped to 55 from 57.7 in December — a 15-month low.
Any reading above 50 means businesses are growing and numbers above 55% are quite healthy. Yet conditions aren’t as good as they were last fall, no thanks to the latest strain of the coronavirus.
Big picture: Omicron clearly dented the economy in January. Millions of people missed time from work and the virus disrupted already strained supply chains.
Yet with cases peaking, most business leaders believe growth will re-accelerate in the near future. Their biggest problem is an ongoing lack of supplies and labor.
Market reaction: The Dow Jones Industrial Average
DJIA,
and S&P 500
SPX,
sank again in Monday trades.
Stocks have tumbled this year in anticipation of the Federal Reserve raising interest rates. Tensions between the U.S. and Russia over Ukraine are adding to the angst.
This post was originally published on Market Watch
