Durable Goods Orders Slide 3.3%
NEW YORK (
) -- New orders for durable goods dropped by a more-than-expected 3.3% to $196 billion in October, after rising 5% in September, the Census Bureau said early Wednesday.
Excluding the volatile transportation sector, durable goods orders still showed a 2.7% drop. Economists were expecting durable goods excluding transportation to rise 0.4%, according to consensus estimates from
Briefing.com
.
Durable goods orders serve as an indicator of manufacturing growth. Manufacturing has been leading the economy out of the recession.
New orders for defense capital goods showed a steep decline of 21.3% in October to $8.3 billion. Shipments decreased 7.4%, unfilled orders dipped 0.5%, while inventories inched up by 0.1%.
Nondefense new orders for capital goods also dropped 4.5% to $70.8 billion. Nondefense goods act as a proxy for producers' durable equipment category of GDP -- the largest component of business investment. Shipments of nondefense capital goods dipped 0.6%. However unfilled orders increased 1.2% to $503.9 billion, while inventories showed a modest 0.6% rise to $134.5 billion.
Shipments for manufactured durable goods in October dropped 0.9% to $196.8 billion, led by a 3.6% drop in machinery shipments.
Unfilled orders, up nine of the last ten months, increased at a slower pace of 0.7% after rising 1.4% in September. Inventories of manufactured durable goods rose by 0.4%.
Stocks were rising in premarket trading on a better-than-expected jobless claims report.
Caterpillar
(CAT) - Get Report
and
Boeing
(BA) - Get Report
were up 0.5% and 0.8% respectively in premarket trading.
-- Written by Shanthi Bharatwaj in New York
>To contact the writer of this article, click here:
Shanthi Bharatwaj
.
>To follow the writer on Twitter, go to
.
>To submit a news tip, send an email to:
.
Disclosure: TheStreet's editorial policy prohibits staff editors and reporters from holding positions in any individual stocks.
