Within the past hour, the Institute for Supply Management, the Arizona-based trade group, has reported that its survey on the nation's manufacturing activity rose to its best level since April of 2011, rising to a solid reading of 56.4. That was up incrementally from September's 56.2.

(It should be noted that a survey result above 50 suggests that this key industrial barometer is expanding. A reading between 42 and 50 is consistent with a contracting manufacturing base, but not a recession. A result below 42 indicates that both this sector and the economy at large are contracting.)

In the latest month, meanwhile, we saw increases in new orders (which rose from 60.5 to 60.6), in supplier deliveries (which picked up from 52.6 to 54.7), in inventory accumulation (which went from an even 50 to 52.5), in backlogs (which headed up from 49.5 to 51.5), and in exports (52.0 to 57.0). At the same time, growth continued, albeit at a lesser rate, in production (60.8 versus 62.6), in employment (53.2 versus 55.4), and in prices paid (55.5 versus 56.5).

Meanwhile, of the 18 manufacturing industries surveyed in this report, 14 showed growth in October, led by textile mills; food, beverage, and tobacco products; and furniture and related products. The four industries reporting contractions in activity last month were apparel, leather, and allied products; primary metals; chemical products; and miscellaneous products.

According to respondents, new textile business is booming, but in fabricated metal products:  "the government shutting down and threatening to go into a default position is causing all kinds of concerns in our markets." 

Looking at the month-to-month tallies, the 56.4, as noted, was the best reading in two-and-a-half years. As to the full 12 months, the range has been from 49.0 (in May of this year) to the latest reading of 56.4. That works out to an average for the year of 52.8. Thus, it is obvious that this latest month was quite strong on both an absolute and a comparative basis. We also note yesterday's issuance of manufacturing activity in the greater Chicago area, which surged to a result above 65, while something of an outlier, was not all that much out of range.

Overall, this report was solid and should help to keep the current quarter from being all that much weaker than the recent six months, or so for the economy.

At the time of this article's writing, the author did not have positions in any of the companies mentioned.