The Institute for Supply Management's factory index jumped to 55.4, exceeding the highest projection in a Bloomberg survey of economists, from 50.9 in the prior month, according to the Tempe, Arizona-based group. Readings above 50 indicate expansion. A separate report showed first-time claims for unemployment insurance fell to the lowest in five years.
Stocks rallied on signs of a global production pickup extending from China through Europe and as central banks pledged to maintain stimulus. Strength in U.S. manufacturing, which accounts for about 12 percent of the world's largest economy, underscores the Federal Reserve's view that the expansion will gain momentum as the impact of federal budget cuts wanes.
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