The KC Fed manufacturing report shows modest improvement in growth with the composite business activity index at 4 for September versus 1 in August and 1 in July.

New orders are at 2 in September versus 5 in August, not very inspiring, but at least showing growth. Employment comes in at 7 versus 0, showing moderate improvement. Prices paid for raw materials remain elevated at 40 in September versus 43 in August. Prices received are at 13 versus 21, suggesting slightly lower pricing power.

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.