The numbers: The Philadelphia Fed’s business condition index jumped to 26.5 in January from 9.1 in December. This topped expectations of a reading of 10.5 in January, according to a Wall Street Journal poll of economists.
It’s the highest level since last February, just before the pandemic shut down the U.S. economy.
What happened: The six-month outlook rose to 52.8, from 43.1 last month. New orders, employment and prices all jumped in January.
Big picture: Manufacturing has been a bright spot in the economy. It has continued to grow despite the resurgence in the coronavirus pandemic. The ISM factory index hit 60.7% in December, its highest level since August 2018. This was the seventh straight month above the 50% mark that shows expansion. Manufacturing was much stronger in Philadelphia than in the New York region, where activity slipped to 3.5 this month.
Market reaction: U.S. stock benchmarks headed modestly higher on Thursday after the inauguration of President Joe Biden. The Dow Jones Industrial Average
DJIA,
+0.83%,
the Nasdaq Composite Index
COMP,
+1.97%
and the S&P 500
SPX,
+1.39%
closed at record highs on Wednesday.
