US stocks higher on positive manufacturing data

<p>US stocks have gained on positive manufacturing data for September.</p>

Wall Street has begin October's trading on a positive note today (October 1st) following better-than-expected manufacturing data for the US.

Two reports have indicated the factory sector is growing – albeit tentatively – with the Markit purchasing managers' index (PMI) publishing a reading of 51.1 for September, while the Institute for Supply Management's index of national factory activity was up to 51.5.

According to the PMI system, any data above the crucial benchmark of 50 indicates expansion, therefore the industry has ended a three-month spell of contraction.

However, the US is not out of the danger zone, with Markit's chief economist Chris Williamson commenting that US manufacturing production and employment could be on the brink of shrinkage, "meaning that the sector is now likely to be acting as a drag on the wider economy".

At 16:40 BST, the Dow Jones was higher by 1.1 per cent to an index value of 13594.0 points and the Nasdaq rallied 0.6 per cent to 3137.7 points.

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