By Vicki Needham - 06/01/10 09:15 PM EDT
Manufacturing grew for the 10th straight month, outpacing forecasts in May, signaling a strengthening economy, according to a report released Tuesday.
The Institute for Supply Management's gauge fell to 59.7 last month from 60.4 in April but still exceeded most forecasts. Readings greater than 50 reflect economic expansion.
The demand for exports caused factories to ramp up hiring as 12 of 18 industries reported growth and the employment index rose 1.3 percentage points to 59.8 percent in May, the sixth consecutive month of growth in manufacturing employment. An employment index above 49.8 percent represents growth.
Improved manufacturing and construction numbers didn't provide enough of a boost for stocks Tuesday, as the Dow Jones industrials tumbled late in the day, finishing down 112 points, or 1.11 percent to 10,024.