Washington, Feb 18: US manufacturers showed further signs of revival on Tuesday, as reports from the Federal Reserve and one of its regional banks showed gains in the sector in January and early February. The Federal Reserve said its gauge of activity at American factories, mines and utilities rose a sharp 0.8 percent in January, led by a weather-related gain in utilities use. Factory output, more than four-fifths of total production, rose 0.3 percent, its fifth straight monthly rise. In a separate report, the Federal Reserve Bank of New York said in its two-year-old Empire Manufacturing Survey of factories in the state that the business conditions index rose to a record 42.05 in early February from 38.85 in January. The two reports may help ease worries over the embattled US factory sector, which has yet to see employment recover from the 2001 recession. Manufacturers have trimmed payrolls for 42 straight months, with about 2.8 million factory jobs lost since President Bush took office in January 2001. Still, another widely watched index compiled by the Institute for Supply Management has shown eight straight months of growing factory output. By the close, the Dow Jones industrial average had gained 87 points, while the Nasdaq composite was up about 26 points. Prices for inflation-sensitive Treasury securities edged up on the day. January's cold weather helped boost overall industrial production, in addition to the manufacturing gain. Utility output climbed a hefty 5.2 percent while natural gas production rose 7.0 percent, its biggest jump since February 2003, according to the Fed. Still, the gain in manufacturing bolstered the pace at which factories operated in January. The capacity use rate rose to 74.6 percent in January, its highest since August 2001. "Machinery, computers, motor vehicles, aerospace products and fabricated metals production all increased for a third consecutive month in January. This is especially significant because these sectors were hit the hardest during the 2000-20001 manufacturing recession," said Jerry Jasinowski, president of the National Association of Manufacturers. "The fact that they are all now finally on a recovery path is welcome news," he said.