US private sector shows tepid job growth, services accelerate

The US job market is still making a weak recovery. Reuters reports:

Companies hired more workers in July but the gains are too slow to reduce unemployment and spur the economy significantly, reports showed on Wednesday...

U.S. private employers added 42,000 jobs in July, payrolls processor ADP Employer Services reported, slightly more than economists forecast but still a tepid figure...

A separate report on Wednesday showed the number of planned layoffs at U.S. firms rose 6.0 percent in July, marking the third straight month of increased layoffs, though downsizing activity appears to be slowing.

But activity in the services sector accelerated in July.

In its report on activity in the services sector, which dominates the U.S. economy, the Institute for Supply Management said its services index rose to 54.3 in July from June's 53.8, showing unexpectedly stronger growth. But the reading for backlog orders dipped to 52.0 from 55.5 in June.

Eurozone services sector activity also accelerated in July. Bloomberg reports:

A composite index based on a survey of euro-area purchasing managers in both industries rose to 56.7 from 56 in June, London-based Markit Economics said today...

An index of euro-area services, which account for about 60 percent of the region’s gross domestic product, rose to 55.8 in July from 55.5 in the prior month, Markit said. The July reading was below the 56 estimated earlier...

Eurozone retail sales, however, stagnated in June. Again from Bloomberg:

European retail sales were unchanged in June as households cut spending in Germany and France.

Sales in the 16-nation euro area showed no increase from May, when they rose 0.4 percent, the European Union’s statistics office in Luxembourg said today. Economists had forecast sales to remain unchanged, the median of 19 estimates in a Bloomberg News survey showed. From a year earlier, June retail sales gained 0.4 percent after rising 0.6 percent in May.

Unlike its counterparts in the US and the euro area, the UK services sector slowed in July. Reuters reports:

Britain's services industry grew at its slowest rate in 13 months in July, a survey showed on Wednesday, as worries about spending cuts weighed on confidence, raising fears about the strength of economic recovery...

The Markit/CIPS services PMI headline activity index fell to 53.1 last month from 54.4 in June, its lowest level since June 2009 and below economists' forecasts for an unchanged reading.