Due to the growth in the new orders index and the employment index, the expansion rate of the U.S. service sector in July rebounded from a four-year low in June. Data from the Institute for Supply Management (ISM) showed that the non-manufacturing index rose by 2.6 to 51.4 in July, up from 48.8 in June, moving back above the 50 threshold, in line with economists' expectations.

In July, the business activity production index increased to 54.5, the new orders index rebounded to 52.4, and the employment index rose to 51.1, indicating significant improvements in employment, orders, and business activity in the service sector, suggesting that the "big component" of the U.S. economy is growing at a moderate pace.

Despite a modest increase of 114,000 in non-farm payrolls and a rise in the unemployment rate to 4.3% in July, raising concerns about an economic downturn, the strong performance in the service sector has partially alleviated these worries. Analysts noted that the slowdown in non-farm job growth in July does not necessarily imply a deterioration in the labor market.

The supplier deliveries index fell to 47.6 in July, indicating a reduction in supply chain pressures; however, the prices index slightly increased to 57.0, suggesting that input costs will rise further, and inflationary pressures remain.

Data from S&P Global showed a strong performance in the service sector contrasted with weak manufacturing performance. The service sector's Purchasing Managers' Index (PMI) for July was 55.0, below market expectations but still indicating ongoing expansion (remaining above 50).

Chicago Federal Reserve President Goolsbee stated that the Federal Reserve (Fed) will respond to signs of economic weakness, but the current interest rate policy is too restrictive. The market expects the Fed to potentially start cutting rates by 0.5 percentage points from September to address economic downside risks.