Per the latest report from the Federal Reserve bank, the Philly Fed manufacturing index improved considerably in the current month on the back of a bump in new orders. Further, industrial production is on track to register its best level since 2010.

Industrial production has, in fact, rebounded in the month of August due to higher automobile and utilities production. Also, the ISM Manufacturing index surged to its best levels in 14 years. Investors looking to cash in on this opportunity should look no further than investing in mutual funds having significant exposure to the manufacturing sector.

U.S. Manufacturing Activity is Flourishing

The Philly Fed manufacturing index exhibited a strong rebound in September. The metric has expanded at a faster pace of 22.9% in the current month than 11.9% in August.

When the index is above 0%, it indicates factory-sector growth. Further, such an increase also depicts that general business conditions in the region have been improving steadily. The surge in the metric has been achieved on the back of a bump in the new orders index, which is at 21.4%. Also, the shipment index has gained about 3 percentage points to hit 19.6% in the month.

Per the latest data from the Institute for Supply Management, the manufacturing index increased for the 112th month on the trot. The index expanded by 3.2% from July to reach 61.3% in August. The metric surpassed the estimated 57.7% mark in the month as well as 58.1% it had hit in the previous month.

Such an increase points toward a strengthening U.S. economy and was buoyed by an increase in new orders and production. While the new orders index surged to 65.1% in August, the production index was at 63.3%. Further, employment index touched 58.5% in the month — its highest level in six months. Finally, the supplier deliveries index reached 64.5% in August to hit its best level since 2004.

3 Best Funds to Buy Now

Given such positives, we have highlighted three mutual funds carrying a Zacks Mutual Fund Rank #1 (Strong Buy) or 2 (Buy) that are poised to gain from such factors. Moreover, these funds have encouraging three and five-year returns. Additionally, the minimum initial investment is within $5000.