By Joseph Adinolfi and Sara Sjolin, MarketWatch

Weak manufacturing report likely won't impact Fed's rate-hike decision, analyst says

U.S. indexes trimmed their gains Tuesday after a widely-watched indicator of U.S. manufacturing activity slipped to its lowest level since mid-2009.

The S&P 500 index was up 9 points on the day, or 0.4%, to 2,089.45 after the data, down slightly from its session-high of 2,098.87.

The Dow Jones Industrial Average was up 69.55 points, or 0.4%, to 17,787 in recent trading, while the Nasdaq Composite rose 17.5 points, or 0.3%, to 5,126.48.

The Institute for Supply Management's manufacturing index fell to 48.6% (http://www.marketwatch.com/story/ism-manufacturing-index-drops-to-lowest-level-since-mid-2009-2015-12-01) in November, down from 50.1% in October (http://www.marketwatch.com/story/us-manufacturers-still-struggling-ism-finds-2015-11-02). Economists had expected manufacturing activity to accelerate to 50.5%.

J.J. Kinahan, chief strategist at TD Ameritrade, called the ISM number "a disaster," but noted that it probably won't dissuade Federal Reserve policy makers from raising interest rates at their policy meeting later this month.

"It doesn't impact our expectations for the Fed at all, but it does perhaps impact the strength we saw earlier today," Kinahan said. "It wasn't quite the strong number we expected."

Investors remained optimistic about the November jobs report, set to be released Friday at 8:30 a.m. Eastern. The report is widely considered the last major piece of data that could influence the Fed's decision about whether or not to lift rates.

Also read: Fed may need 4% unemployment rate to hit inflation goal (http://www.marketwatch.com/story/fed-may-need-4-unemployment-rate-to-hit-inflation-goal-2015-11-30)

Data: Aside from the ISM report, the U.S. economic data released Tuesday was relatively robust.

Construction spending jumped a seasonally adjusted 1% in October, beating the expectations of economists polled by MarketWatch (http://www.marketwatch.com/story/construction-spending-rises-10-in-october-2015-12-01-1091510). Meanwhile, U.S. auto sales posted modest monthly gains (http://www.marketwatch.com/story/us-nov-car-sales-buoyed-by-black-friday-deals-2015-12-01).

Fed speakers: Chicago Fed President Charles Evans will give a speech on the economy to the Lansing Regional Chamber of Commerce at Michigan State University at 12:45 p.m. Eastern.

At 8 p.m. Eastern, Fed Gov. Lael Brainard will talk about the "Lower Neutral Rate and its implications for Monetary Policy" at Stanford Institute for Economic Policy Research Associates Meeting in Stanford, Calif.

Movers and shakers: Shares of instruments and microwave-components maker Giga-Tronics Inc (http://www.marketwatch.com/story/giga-tronics-stock-more-than-doubles-after-software-licensing-deal-2015-12-01).(GIGA) more than doubled after the company announced a software-licensing deal with Lockheed Martin Corp.

Shares of Amazon.com(AMZN) edged 0.5% higher after the online retailer said the Black Friday period marked a record weekend for sales of its own devices (http://www.marketwatch.com/story/amazon-crushes-black-friday-weekend-with-record-sales-of-its-own-devices-2015-12-01).

Infoblox Inc.(BLOX) shares rose 20% after the network software company late Monday reported earnings that topped analyst expectations (http://www.marketwatch.com/story/infoblox-shares-rally-on-earnings-outlook-buyback-plan-2015-11-30).

Shares of HF Financial Corp.(HFFC) surged 19.3% on reports that Great Western Bancorp Inc.(GWB) intends to buy the company for $139.4 million.

Other markets: Asian stock markets closed broadly higher (http://www.marketwatch.com/story/asian-shares-rise-on-hopes-for-stimulus-yuan-holds-steady-2015-12-01) after a flurry of weak PMIs lifted hopes for more monetary easing.

European equities (http://www.marketwatch.com/story/european-stocks-trim-gains-as-ecb-meeting-looms-2015-12-01) seesawed, with investors reluctant to take any major positions ahead of the ECB meeting on Thursday. Economists widely expect the central bank to extend its quantitative easing program and possibly move the deposit rate further into negative territory.

Crude oil futures turned lower after briefly trading above $42 (http://www.marketwatch.com/story/oil-prices-rise-as-opec-meeting-draws-closer-2015-12-01) a barrel as the meeting of the Organization of the Petroleum Exporting Countries meeting this Friday in Vienna drew closer.

Gold edged higher, while the dollar slipped against most major currencies (http://www.marketwatch.com/story/yen-gains-on-reports-of-currency-hedging-by-japans-mega-pension-fund-2015-12-01).

Subscribe to WSJ: http://online.wsj.com?mod=djnwires

(END) Dow Jones Newswires

December 01, 2015 10:57 ET (15:57 GMT)

Copyright (c) 2015 Dow Jones & Company, Inc.