Industrial production was surprisingly robust in December. A 1.6 percent monthly rise was nowhere close to the market consensus and the first increase since last August. Following a smaller revised 0.1 percent dip in November, the jump boosted annual workday adjusted growth from minus 3.4 percent to 0.1 percent, its first positive print in four months.

The monthly gain was broad-baaed. Capital goods (3.1 percent) saw the largest advance but consumer goods (1.6 percent) also had a good month and intermediates (0.8 percent) made progress too. Energy (2.6 percent) similarly made a positive contribution.

However, today's surprisingly upbeat report still leaves fourth quarter industrial production 0.9 percent below its level in the third quarter when it contracted 0.5 percent. Goods producing industries again subtracted from GDP growth and are now in technical recession. Even so, although the ECDI (minus 3) is just below zero, at 16, the ECDI-P shows that overall real economic activity is still running a little head of market expectations. Indeed, this measure has been consistently in positive surprise territory since late-October last year.

After sinking the last three reports, industrial production is expected to sink again in December by 0.2 percent.

Industrial production measures the physical output of the nation's factories, mines and utilities. Construction is excluded. Approximately 4,100 companies provide data on more than 8,000 monthly flows of production.

Investors want to keep their finger on the pulse of the economy because it usually dictates how various types of investments will perform. The stock market likes to see healthy economic growth because that translates to higher corporate profits. The bond market prefers more subdued growth that will not lead to inflationary pressures. By tracking economic data such as industrial production, investors will know what the economic backdrop is for these markets and their portfolios. Like the PPI and the orders data, construction is excluded from the data. This report has a big influence on market behavior. In any given month, one can see whether capital goods or consumer goods are growing more rapidly. Are manufacturers still producing construction supplies and other materials? This detailed report shows which sectors of the economy are growing and which are not.