The Federal Reserve Bank of Richmond released its survey of manufacturing activity on Tuesday. The composite index for manufacturing dropped to 14 in April from 22 in March. Analysts had expected the index to decrease to 11.

The decrease was mainly driven by drops in shipments and new orders.

Shipments sub-index slid to 14 in April from 27 in March, while new orders sub-index was down to 18 from 24.

The employment sub-index declined to8 from 11.

"Shipments and the volume of new orders remained solid. New hiring increased modestly, while the average workweek lengthened and average wage increases moderated. Prices of raw materials and finished goods rose at a faster pace compared to last month," the survey said.