U.S. manufacturing activity contracts by more than expected in October - ISM

Investing.com -- Activity in the U.S. manufacturing sector shrank by more than anticipated in October, according to a key business survey on Wednesday.

The Institute for Supply Management's purchasing managers' index, a measure of factory activity in the world's largest economy, came in at 46.7 last month. Economists had predicted that the reading, which is below the 50-point mark denoting contraction, would remain unchanged at its September level of 49.0.

New orders and employment also slumped, leading ISM business survey committee chair Timothy Fiore to note that "demand remains soft," adding "[o]f the six biggest manufacturing industries, only one — Food, Beverage&Tobacco Products — registered growth in October."

Manufacturing, which accounts for around 11% of the American economy, has been hit by a rise in interest rates, although separate data from the Federal Reserve has found that production of longer-lasting manufactured goods jumped solidly in the third quarter. The central bank's figure helped contribute to a picture of a resilient U.S. economy during the July to September period despite headwinds such as widespread strikes by some automobile industry workers.