Economic activity in the manufacturing sector expanded in November, according to The Institute for Supply Management on Thursday, and the overall economy grew for the 90th consecutive month.
U.S. manufacturing index hit 53.2 in November, up from 51.9 in October, according to The Institute for Supply Management. The index was expected to hit 52.2 for November, according to Thomson Reuters consensus estimates.
A reading above 50 indicates expansion in the manufacturing sector and a reading below 50 indicates contraction.
"Of the 18 manufacturing industries, 11 are reporting growth in November," Bradley Holcomb, chair of the Institute for Supply Management, said in the report.
The leading two industries on the report were miscellaneous manufacturing and petroleum and coal products.
The New Orders Index, which includes reporting from apparel, food, beverage and more products, registered 53 percent, an increase of 0.9 percentage point from the October reading of 52.1 percent. The Production Index registered 56 percent, over 1 percentage point higher than the October reading of 54.6 percent, according to the report.
From October 2015 through February of this year, U.S. manufacturing retreated in the face of economic weakness overseas and a strong dollar. That made U.S. exports more expensive. But factories began to recover as the dollar tumbled during the first half of the year.
The manufacturing index is based on surveys of more than 300 manufacturing firms by the Institute of Supply Management. It monitors employment, production, new orders, supply deliveries and inventories.
U.S. construction spending increased in October to a seven-month high amid gains in home building and public outlays, and estimates for the prior two months were revised sharply higher, pointing to strength in the sector.
The Commerce Department said on Thursday that construction spending increased 0.5 percent in October to $1.173 trillion, the highest since March 2016. Construction spending in September was revised up to show it unchanged instead of declining 0.4 percent as previously reported.
Outlays for August were also revised higher to show a 0.5 percent gain rather than the previously reported 0.5 percent drop. Construction spending was up 3.4 percent from a year ago in October.
October's increase was in line with economists expectations.
Spending on private construction projects slipped 0.2 percent in October as outlays on private nonresidential structures - which includes factories, hospitals and roads - tumbled 2.1 percent after falling 0.8 percent the prior month.
Spending on private residential construction, however, rose 1.6 percent after increasing 0.6 percent in September.
The government reported on Tuesday that spending on nonresidential structures contributed 0.26 percentage point to the third-quarter's 3.2 percent annualized growth rate.
Public construction spending jumped 2.8 percent in October, rising for a third straight month. Outlays on state and local government construction projects advanced 2.3 percent, also gaining for a third straight month.
Federal government construction spending surged 8.1 percent, reversing September's 1.6 percent drop.
—CNBC's Berkeley Lovelace and The Associated Press contributed to this report.
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