Corrects to say “Any reading below zero indicates deteriorating conditions”
The numbers: The Philadelphia Federal Reserve said Thursday its gauge of regional business activity rose slightly to negative 8.9 in January from negative 13.7 in the prior month. Any reading below zero indicates deteriorating conditions. This is the fifth straight negative reading and the seventh in the last eight months.
Economists polled by the Wall Street Journal expected a negative 10 reading in January.
Key details: The barometer on new orders increased 11 points but remained at negative 10.9 in January. The shipments index rose12 points to 11. Employment measures strengthened in the month. The measure on six-month business outlook rose to 4.9 in January from negative 0.9 in the prior month.
Big picture: The Philadelphia Fed index is one of several regional manufacturing gauges that offer timely reads of the manufacturing sector.
Earlier this week, the similar Empire State survey released by the New York Fed showed manufacturing activity sank 21.7 points to negative 32.9 in January.
Both readings are followed by investors because they are seen as early indicators of national manufacturing activity. The national ISM manufacturing index contracted in December for the second straight month, falling to 48.4% from 49% in the prior month.
Some economists are saying the factory sector has entered into recession territory due to the strong dollar, weak demand for goods and a weak global economy.
Market reaction: Stocks
were set to open lower on Thursday. The yield on the 10-year Treasury note
rose to 3.41%.