A gauge of the US economy's health rose in July, pointing to stronger growth in the second half of the year.

The Conference Board said that its index of leading indicators increased 0.6% last month to give a reading of 96. The increase followed no change in June and a 0.2% increase in May.

The index from the business research group is comprised of several previously released data point that when combined can signal economic conditions over the next three to six months.

The solid gain suggests economic growth is picking up after a weak start.

The US economy grew at an annual rate of 1.4% in the six months from January to June. Many economists expect growth could improve to a 2.5% rate in the second half of 2013.

US unemployment aid applications rise to 336,000

Separate figures today showed that the number of Americans applying for unemployment benefits rose last week after reaching the lowest level in over five years.

But the broader trend suggests companies are laying off fewer workers and could step up hiring in the months ahead.

The Labor Department said today that applications for first-time benefits rose 13,000 to a seasonally adjusted 336,000 in the week ending August 17. That is up from 323,000 in the previous week, which was the lowest since January 2008.

The four-week average, which smooths week to week fluctuations, fell by 2,250 to 330,500. That is the sixth decline in a row and the lowest for the average since November 2007.

At the depths of the recession in March 2009, applications numbered 670,000.

Applications for unemployment benefits generally reflect layoffs and the four-week average has fallen 5% in the past month. The drop suggests employers added 200,000 or more jobs in August, an improvement from the 162,000 added in July.

The US unemployment rate fell to a four year low of 7.4% last month, down from 7.6% in June. That is still well above the 5-6% range associated with a normal economy.