TEMPE, Ariz. (
) -- Factory activity took a mild step back while continuing to show expansion for the 10th consecutive month in May though only after touching a near six-year high in April, according to a national survey of manufacturing managers,.
The Institute for Supply Management said its primary index tracking economic activity in the manufacturing ranks read 59.7 last month, which was a slight decline from the 60.4 reading posted in April. Still, the May mark finished just better than consensus estimates calling for a decline to 59.4, according to figures provided by
In April, business activity expanded at its fastest rate since June 2004.
The index was created using survey responses from supply executives throughout the U.S. Typically, a reading above 50 tends to suggest growth and expansion in the sector, while a reading below that mark hints at a slowing contraction.
Several individual assessments within the report also showed improvement in May. Exports and order backlogs, for instance, bettered last month. An index measuring new orders, however, remained flat at 65.7, while a reading on production backtracked slightly to 66.6 in May from 66.9. Inventories fell 3.8 points to register 45.6 last month.
But the report also hinted at improvement in the labor market, as an individual index tracking factory employment also rose to 59.8 from 58.5 the month before. On Friday, the Labor Department will release its May employment report. Early estimates anticipate employers added another 500,000 jobs to nonfarm payrolls last month, while the nation's unemployment rate probably fell to 9.8% from 9.9%.
The better-than-expected manufacturing news helped U.S. stocks pare their morning losses.
--Written by Sung Moss in New York