Group says U.S. manufacturing sector expanded at faster pace in June

Associated Press
Published: Monday, July 2, 2007 8:56 a.m. MDT
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NEW YORK — The nation's factories, plants and utilities should continue picking up steam in coming months, a research group said Monday, suggesting hardy consumer spending and moderating inflation are boosting confidence among manufacturers.

The Institute for Supply Management said that its manufacturing index rose to 56 in June. The reading marked the fifth consecutive month of growth.

The reading was above the May reading of 55 and higher than the market expectation of 55.4.

A reading above 50 indicates growth while a reading below 50 indicates contraction.

New orders, production and employment powered growth, while inventories continued contraction.

"Following a weak first quarter, the manufacturing sector rebounded in a strong fashion during the second quarter," said Norbert J. Ore, chair of ISM's survey committee.

The strength of the new orders and production suggests the that growth appears sustainable throughout the third quarter, Ore said.

The top performing industries were petroleum and coal products; chemical products; plastics and rubber products; food, beverage and tobacco products; nonmetallic mineral products; computer and electronic products; paper products; fabricated metal products; primary metals; miscellaneous manufacturing; textile mills; and machinery.

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In morning trading, the Dow Jones industrial average rose 49.91 to 13,458.53. Broader stock indicators were also higher. The Standard & Poor's 500 index rose 0.44 percent to 1,509.97, and the Nasdaq composite index gained 0.47 percent to 2,615.41.

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