The Philadelphia Federal Reserve Bank released its manufacturing index on Thursday. The index climbed to -3.5 in January from -10.2 in December, exceeding expectations for an increase to -5.0. December's figure was revised down from -5.9.

A reading above zero indicates expansion, while a reading below zero indicates contraction.

"Manufacturing conditions in the region contracted modestly this month, according to firms responding to the January Manufacturing Business Outlook Survey. The indicator for general activity remained negative this month; however, it rebounded from a lower reading in December," the Philadelphia Federal Reserve Bank said in its survey.

The shipments index was up to 9.6 in January from -2.1 in December.

The new orders index increased to -1.4 in January from -11.1 in December.

The prices paid index rose to -1.1 in January from -8.3 in December, while the prices received index climbed to -2.8 from -8.5.

The number of employees index dropped to -1.9 in January from 2.2 in December.

According to the report, the future general activity index slid to 19.1 in January from 24.1 in December.