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U.S. manufacturing sector picks up in October

In this Friday, June 22, 2012, file photo, Tesla Model S frames are shown in the assembly area at the Tesla factory in Fremont, Calif.

Paul Sakuma/AP

The pace of growth in the U.S. manufacturing sector picked up modestly in October as new orders improved, though a measure of employment slowed, an industry report released on Thursday showed.

The Institute for Supply Management (ISM) said its index of national factory activity rose to 51.7 from 51.5 in September, topping economists' expectations for a slight decline to 51.2, according to a Reuters poll of economists.

A reading above 50 indicates expansion in the manufacturing sector. It was the second month in a row the sector has grown after contracting through the summer.

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After helping support the U.S. economic recovery, the sector has faltered recently in the midst of slower growth in China and uncertainty surrounding the euro zone debt crisis.

The forward-looking new orders measure gained to 54.2 from 52.3, but employment cooled to 52.1 from 54.7. (Reporting by Leah Schnurr; Editing by Chizu Nomiyama)

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