US Composite PMI Hits 4-Month High Post Government Shutdown, Driving Market Gains

The S&P Global Flash US Composite PMI climbed to a 4-month high of 54.8 in November 2025 (up from October’s 54.6), driven by the conclusion of the 43-day government shutdown and market optimism for interest rate cuts [1]. This expansion (PMI >50) translated to broad equity gains: S&P 500 (+0.72%), Dow Jones Industrial Average (+0.95%), and NASDAQ Composite (+0.50%) [0]. Sector performance mirrored PMI trends: Healthcare (+1.73%) and Industrials (+1.52%) led gains (aligning with strong services output and manufacturing production), while Utilities (-0.88%) lagged (a rate-sensitive sector signaling concerns about interest rate trajectories) [0].

1. Sector Correlation
   : PMI’s sector strengths directly aligned with market performance—services growth (PMI) drove Healthcare gains, and manufacturing production resilience boosted Industrials.
2. Rate Sensitivity Signal
   : Utility underperformance (the only declining sector) contrasts with rate cut hopes, indicating market uncertainty about Federal Reserve policy.
3. Manufacturing Dichotomy
   : Robust production in November vs. slowing new orders suggests near-term strength but potential future headwinds if demand does not recover.

• Risks
  : Manufacturing new orders slowdown (a leading indicator of potential production cuts [1]); lingering government shutdown impacts on small businesses and consumer confidence [1]; rate sensitivity concerns highlighted by utility sector underperformance [0].
• Opportunities
  : Healthcare and Industrials sector momentum (supported by PMI trends [0]); broad economic expansion signaling potential support for corporate earnings.

• Composite PMI (Nov 2025): 54.8 (4-month high) [1]
• Market Indices: S&P 500 (+0.72%), Dow (+0.95%), NASDAQ (+0.50%) [0]
• Top Sectors: Healthcare (+1.73%), Industrials (+1.52%) [0]
• Lagging Sector: Utilities (-0.88%) [0]
• Critical Watchpoints: Monthly manufacturing new order trends, Federal Reserve rate announcements, and small business confidence surveys.