Wall Street took heart Monday morning from strong economic indicators showing the economy swung back in February after the polar vortex froze many sectors earlier this year.
Figures released Monday by the Federal Reserve reveal that manufacturing performed strongly in February, and more than bounced back after a slowdown in January. Industrial production increased 0.6 percent in February, reversing a 0.2 percent drop in the first month of the year due to extreme weather, which can slow consumer spending, construction activity, and hiring. Meanwhile, factory production rose a full 0.8 percent, nearly making up for a 0.9 percent decline in January.
Auto production rose 4.6 percent after falling 5.1 percent in January, and home electronic output increased 0.7 percent.
The gain in overall factory production was the largest since 6 months ago in August, and the Dow Jones catapulted 200 points in early trading Monday in response to the surge in output.
Consumer goods production, a key reflection of the overall economy's health, increased 2.6 percent in February compared to the same month last year as it drifts up slowly to 2007 levels. Total industrial production is operating at a higher level than it was before the recession, with February industrial production at 101.6 percent of its 2007 average.
February saw fairly strong job gains as well. Total non-farm payroll employment increased by 175,000 last month, and even though the unemployment rate didn’t change, the data points to signs of strength after the January freeze. The International Monetary Fund expects the United States gross domestic product to grow 2.8 percent in 2014, compared with 1.9 percent in 2013.