Kansas City Fed district manufacturing activity edges up marginally in July from June after contracting slowly in June and May. The Kansas City Fed composite index of current business conditions is at 1 in July versus minus 2 in June and minus 3 in May

The current new orders index rises to 2 in July from minus 2 in June and minus 9 in May. The number of employees index dips to minus 11 in July from minus 8 in June and from 3 in May. Prices paid comes in at 47 in July versus 51in June versus 34 in May.

The Kansas City Fed index offers a monthly assessment of change in the region's manufacturing sector. Positive readings indicate monthly growth and negative readings monthly contraction. Readings at zero indicate no change. The headline number is the composite index, an average of the production, new orders, employment, delivery time, and raw materials inventory indexes.

Investors track economic data like the Kansas City Survey of Manufacturers to understand the economic backdrop for the various markets. The stock market likes to see healthy economic growth because that translates to higher corporate profits. The bond market prefers a moderate growth environment that will not generate inflationary pressures. The survey gives a detailed look at Tenth District's manufacturing sector, how busy it is and where it is headed. Some of the survey indexes also provide insight on inflation pressures—including prices paid, prices received, wages & benefits, and capacity utilization. The equity market is also sensitive to this report because it is an early clue on the nation's manufacturing sector, reported in advance of the ISM manufacturing index and often in advance of the NAPM-Chicago index.