Services sector activity in US advances to 12-1/2-year high

U.S. services sector activity raced to a near 12-1/2-year high in January, buoyed by robust growth in new orders, the latest sign of strong momentum in the economy at the start of the year.

The ISM said its non-manufacturing activity index jumped 3.9 points to 59.9, the highest reading since August 2005. A reading above 50 indicates expansion in the sector, which accounts for more than two-thirds of U.S. economic activity.

Services industries reported new orders jumped 8.2 points to 62.7, the best reading since January 2011. The survey's production index rose 2.0 points and a measure of services sector employment soared 5.3 points to a record high.

The survey came on the heels of a report on Friday showing an acceleration in job growth in January and the strongest annual wage growth in more than 8-1/2 years.