The Institute for Supply Management released its non-manufacturing purchasing managers' index for the U.S. on Tuesday. The index climbed to 57.8 in April from 56.5 in March. Analysts had expected the index to remain unchanged at 56.5.
A reading above 50 indicates a growth in the service sector.
The increase was partly driven by a rise in the non-manufacturing business activity index, which climbed to 61.6 in April from 57.5 in March.
The ISM's new orders index increased to 59.2 in April from 57.8 in March.
The ISM's business activity/production index was up to 61.6 in April from 57.5 in March.
The ISM's employment index climbed to 56.7 in April from 56.6 in March.
The ISM's price index fell to 50.1 in April from 52.4 in March.