The Institute for Supply Management released a report on Tuesday showing a modest increase by its reading on U.S. manufacturing activity in the month of June.
The ISM said its manufacturing PMI crept up to 49.0 in June from 48.5 in May, although a reading below 50 still indicates contraction. Economists had expected the index to inch up to 48.8.
The uptick by the headline index partly reflected a turnaround by production, as the production index jumped to 50.3 in June from 45.4 in May.
Meanwhile, the report said the new orders index fell to 46.4 in June from 47.6 in May, indicating the fifth straight month of contraction.
The employment index also slid to 45.0 in June from 46.8 in May, suggesting a continued decrease in jobs in the manufacturing sector.