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Although the headline figure showed a dip in factory activity for the month of September, Paulson said the employment portion of the report showed a rise.
The ISM index fell to 58.5 percent in September from 59.0 percent in August, in line with expectations. The employment index however rose to 58.1 from 55.7 in August.
"What the employment uptick really does is tell us that maybe next Friday we're going to a better-than-expected employment report," which suggests the soft patch in the economy may be ending, said Paulson.