Service sector index improves, hinting that economy may be stabilizing

The U.S. services sector, like its sister sector, manufacturing, continues to show signs of improvement, and this bodes well for the economy.

The Institute for Supply Management's Service Index rising for the second straight month, to 43.7 in April from 40.8 in March, the ISM announced Tuesday. Readings below 50 indicate a contraction; above 50, an expansion.

The index's closely-watched business activity component also rose for the second consecutive month, climbing to 45.2 in April from 44.1 in March. The business activity component totaled 40.2 in February.