Here’s yet another disappointing U.S. economic report: The ISM manufacturing index fell to 53.5 in May, down from 60.4 – missing expectations and hitting its lowest level since September 2009.

The good news? Any reading above 50 shows expansion, so the decline since February merely corresponds to slowdown in the rate of expansion rather than a nasty contraction in activity.

“Indeed, the real surprise is that the ISM has been so lofty in the prior months relative to what we were observing in other measures of factory activity,” said Krishen Rangasamy of CIBC World Markets, in a note.

Still, investors aren’t taking this one well. The S&P 500, which opened slightly lower following a disappointing reading on U.S. private-sector employment gains in May, fell further after the ISM report. It was recently down 12 points or 0.9 per cent in mid-morning trading.