Today's upbeat data help boost the case for a December Fed rate hike - ING

"Strong manufacturing orders, production and employment help boost the case for a December Fed rate hike," notes James Knightley, Chief international Economist at ING.

Key quotes:

"The US ISM manufacturing index for October has come in at 58.7. This is down from September’s reading of 60.8, which was a 13 year high, and is a little weaker than the 59.5 consensus forecast. Nonetheless it remains a very strong report."

"New orders are still at incredibly good levels (63.4 versus the 50 break even level) and production also stayed above 60. Meanwhile employment only dipped modestly (to 59.8 from 60.3). Together with a good ADP employment report showing 235,000 jobs added, it bodes well for Friday’s payrolls figure which we expect to exceed 300,000. Indeed, the ISM report suggests 83% of manufacturers are seeing employment growth right now."

"As for inflation, the prices paid component fell to 68.5 from 71.5, but remains well above its 6M moving average. This suggests pipeline price pressures continue to build, supporting the Fed’s view that sub 2% inflation is merely transitory."

"All in all it is a very good report that suggests the sector has made an excellent start to 4Q. This should give the Federal Reserve even greater confidence that it can continue with its “gradual” pace of policy tightening. We still look for a December rate hike followed by at least two more next year, irrespective of who leads the Fed."