WRAPUP 4-US factories weak in early May, job market soft

(Updates with markets close)

* Data shows weak start to May for U.S. factories

* Jobless rolls remain high and housing weak

* Markets unfazed by U.S. data

By Burton Frierson

NEW YORK, May 15 (Reuters) - The U.S. factory sector started the month on a weak note after declining in April, data showed on Thursday, while the number of workers stuck on jobless rolls hit a four-year high.

Together with poor sentiment among home builders, the data paints a weak picture of the U.S. economy. But it also sends mixed signals on inflation, leaving the Federal Reserve in a dilemma as it seeks to support the economy while keeping price pressures in check.

Factory activity in the U.S. mid-Atlantic region shrank for a sixth straight month in May, and manufacturing in New York State also declined this month, according to reports by regional Federal Reserve banks.

The poor start to May came after nationwide industrial production tumbled a bigger-than-expected 0.7 percent in April due to the most severe contraction in the manufacturing sector in nearly three years, the Federal Reserve said.