East coast factories bounce back in positive signal for US recovery

FACTORY activity in the US mid-Atlantic region rebounded in October and the number of Americans claiming new jobless benefits fell last week, fresh signs that the economy was likely to duck a new recession.

Yet optimism over the economy was tempered by other data yesterday showing a drop in sales of previously owned homes last month and only a small rise in a gauge of future growth.

Initial claims for state unemployment benefits slipped 6,000 to a seasonally adjusted 403,000.

Separately, the Philadelphia Federal Reserve Bank said its business activity index rebounded to 8.7 in October, the highest reading in six months, from minus 17.5 in September.

Yet sales of existing homes dropped three per cent to an annual rate of 4.91m units, another report showed.