By CountingPips.com
The US dollar has been trading lower against most of the major currencies in the forex markets as positive manufacturing data has boosted risk appetite today. The positive investor mood has pushed the higher yielding 
currencies as well as the US stock markets to higher trading levels in the afternoon of the US trading session. The dollar has been decreasing on the day versus the euro, British pound sterling, Australian dollar, New Zealand dollar, Swiss franc and the Canadian dollar while trading higher against the Japanese yen.
The US stock markets, meanwhile, have surged higher on the first trading day in September with the Dow Jones industrial average increasing by over 200 points, the NASDAQ up by over 50 points and the S&P 500 higher by over 25 points at time of writing. Oil has risen by $2.12 to the $74.04 level while gold has fallen by $4.70 dollars to trade at the $1243.60 level.
ISM Manufacturing data increases for 13th month
U.S. Manufacturing data activity surpassed market forecasts and rose for the 13th straight month in August, according to today’s report by the Institute for Supply Management. The ISM Report On Business index reading for economic activity was at a 56.3 score in August following July’s reading of 55.5. A score above 50 is considered to be growth and less than 50 is considered to be contraction in that sector.
Market forecasts were predicting a decline for the month of August and a reading of 52.8 in the index.
Norbert J. Ore, chairman of the ISM Business Survey Committee, commented in the report that, “Manufacturing activity continued at a very positive rate in August as the PMI rose slightly when compared to July. In terms of month-over-month improvement, the Production and Employment Indexes experienced the greatest gains, while new orders continued to grow but at a slightly slower rate. August represents the 13th consecutive month of growth in U.S. manufacturing.”
The customers inventories and prices indexes both rose by over 4.0 percentage points in August, according to the report. Production increased by 2.9 percent, employment rose by 1.8 percent while the backlog of orders index fell by 3.0 percent. Exports declined by 1.0 percent while imports edged higher by 4.0 percent to round out the data.
August ADP employment data reverses six months of gains
U.S. employment data released today in the form of the ADP National Employment Report showed that U.S. private employment declined unexpectedly in the month of August. The nonfarm private employment fell by 10,000 workers in August following the revised increase of 37,000 jobs in July. The jobs data for July was revised slightly lower from the original estimate of 42,000 jobs gained. ADP private employment had risen for six consecutive months from February to July before the August decrease.
Today’s job report was a surprise to market forecasters that were expecting an approximate increase of 15,000 jobs for the month.
The service-providing sector registered an increase of 30,000 jobs in August while the goods-producing sector fell by 40,000 jobs. Manufacturing had a loss of 6,000 jobs, construction jobs fell by 33,000 workers and the financial services sector decreased by 5,000 workers. Construction and financial services jobs have now both continued to decline for over three years straight, according to the ADP report.
Medium-size businesses shed 6,000 workers in August while small businesses or companies with less than 50 workers registered a decrease of 6,000 workers. Large businesses or companies with more than 500 workers saw employment payrolls virtually unchanged for the month.
The market-moving US Nonfarm Payrolls report for August is to be released Friday at 12:30 pm GMT with early market forecasts predicting a loss of approximately 105,000 jobs following a decline of 131,000 workers in July.
