Prior month 4Composite index 5 vs 10 estimateServices index -3 versus -1 last monthManufacturing shipments 8 versus 3 last monthThe Richmond Fed Manufacturing Index is a monthly survey published by the Federal Reserve Bank of Richmond that measures manufacturing activity in the Fifth Federal Reserve District, which includes Virginia, Maryland, North Carolina, South Carolina, the District of Columbia, and most of West Virginia. It is released on the fourth Tuesday of each month and is one of several regional Fed manufacturing surveys that provide an early look at U.S. factory activity. How to interpret it:Above 0: Manufacturing activity is expanding.Below 0: Manufacturing activity is contracting.Higher than expected: Stronger manufacturing sector.Lower than expected: Weaker manufacturing sector.Why markets care:A strong reading can support the U.S. dollar and Treasury yields while boosting economically sensitive stocks.A weak reading can pressure the dollar and yields, increase expectations for Fed easing, and weigh on cyclical stocks.Beyond the headline, traders pay close attention to new orders, employment, shipments, and prices paid for clues about future growth and inflation. This article was written by Greg Michalowski at investinglive.com.