Bolstering hopes of a sustained, if moderate, economic recovery, the Institute for Supply Management said its monthly survey of managers showed "continued strength in new orders and production," despite the rate of growth slowing slightly.

The firm's manufacturing index, also known as the purchasing managers index, stood at 59.7%, down slightly from the 60.4% April.

"At 59.7 the index is well above the 50% growth threshold and at an elevated level similar to what was seen in late 2003 when the manufacturing sector broke out of the 2001 recession," said Daniel J. Meckstroth, Chief Economist for the Manufacturers Alliance/MAPI. "Very low consumer inventories and strong gains in exports signaled in the ISM report point to key reasons for the strong and quick industrial rebound in this cycle. There is a post-financial crisis global recovery in foreign trade coupled with a large domestic inventory swing which accounts for this very broad-based recovery in manufacturing activity and the upward price pressure in raw materials.
 
"A corroborating indicator of the strength in the manufacturing rebound is the fact that respondents to the ISM survey are so bullish on job growth in a sector that is not known for job creation," he added. "The supply chain pipeline is filling with orders and manufacturing firms are reluctantly, but out of necessity, adding staff."