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Manufacturing, Housing Data Whispers That Jobs Report Will Beat the Number

NEW YORK (TheStreet) -- Forecasters say the economy probably generated about 211,000 new jobs in June -- not much fewer than the 217,000 it churned out during May. But the drip of data coming out about the economy increasingly suggests that is too low.

The reason: Housing and manufacturing, two of the industries that most need to get cracking to get the unemployment below 6%, are finding a new gear. And if the better reports from those sectors turn into more jobs, then the summer will bring the expected bounce back from the first quarter, when job creation held up despite a 2.9% decline in gross domestic product.

The latest data today come from the Institute of Supply Management, whose monthly index of manufacturing activity dipped slightly to 55.3, on a scale where anything above 50 shows an expansion and above 55 generally means a strong one.  It was 55.4 last month, and as low as 51.3 in January -- and the crucial index of new orders rose 2 points to 58.9.

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That followed a big gain in the Dallas Federal Reserve Bank's assessment of manufacturing conditions in the Lone Star state, released on Monday. The regional Chicago purchasing managers' index, also released by the ISM, showed a decline, but the index stayed at a very robust 62.6 and the production index (which measures how much is being made now) topped 70.

The news from housing -- the economy's big worry just a few weeks ago -- is also improving. Pending home sales jumped 6.1% in May, the National Association of Realtors said Monday. That's the biggest monthly jump since 2010, when an expiring tax credit created artificial demand. That followed a 19% gain in new home sales for May reported earlier in the month.

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