PROSPECTS for the global economic recovery received a welcome boost yesterday as growth in the US manufacturing sector crept to a six-year high.
The news sent the S&P climbing 15 points to nudge back over the 1,200 mark, offsetting much of last week’s 20 point drop.
The ISM manufacturing index rose to 60.4 in April, up from 59.6. It is now at a level consistent with a GDP growth of more than five per cent.
The figures were dragged upwards by a pick-up in new orders, a strong production index and a jump in employment.
New orders rocketed from 61.5 to 65.7 on the index, recouping losses made in February and March and streaks ahead of the levels seen during the doldrums of 2008 and 2009. The production index hit a new cyclical high of 66.9, up from 61.1.
The employment index climbed more than three points. It is now at its highest level since 2005 and a whopping 3.4 points above its March reading. Inventories and delivery times were slightly down.
Analysts said the upwards trends may be close to peaking and expect the second half of 2010 to be weaker but welcomed the relatively high level reached.
The figures come as some relief after the tentative recovery took a hammering last month when the Greek crisis threatened to infect other Eurozone countries.