Manufacturing activity returned to growth last month but remained fragile as the sector braces for ongoing fiscal policy uncertainty that was only partly eased by the New Year's Day deal.
The Institute for Supply Management's index rose to 50.7 in December from 49.5. Readings above 50 indicate growth.
An export orders subindex shot up to 51.5 from 47, indicating expansion for the first time since May. An imports gauge jumped to a six-month-high 51.5 from 48.
Manufacturers also started hiring again with the employment gauge climbing 4.3 points to 52.7.