Durable Goods
New orders for May Durable Goods unexpectedly rose both headline and ex transports. Headline rose 1.8% vs a forecasted drop of .9% while ex transports rose 1.1% vs an expected fall of .5%. The prior month was revised lower by a touch. Non defense capital goods ex aircraft, the pure cap ex component, rose a solid 4.8% but after drops in the two prior months and is still down 23.1% y/o/y. The headline # was boosted by a 68.1% rise in non defense aircraft orders which is a highly volatile category. Vehicle and parts orders fell 8.1% and are down 32% y/o/y and it’s the main group where a 2nd half inventory rebuild is expected to come from. The main support to the ex transport # was a 7.7% gain in machinery orders and a 2.2% rise in computers/electronics. Primary metals were little changed and electrical equipment orders fell 1.1%. One caveat, the inventory to shipments ratio rose to 1.90, the highest since ‘92.
June 24th, 2009 at 10:03 am
Looks like someone finally bought a washer/dryer combo that they did not need…
June 24th, 2009 at 1:26 pm
it’s news this week, it’s noise next month.
all the data i’ve looked at, and all the commentary i’ve cooked in the big pot of consensus, seems to indicate that things are bottoming out. that means a lot of data — some of it up, some of it down, most of it sideways.
the market still has to price in the future costs of restructuring (e.g., energy, resources, retraining), of money (inflation), and of write offs (bad debt), so i’m thinking we’re now in a trading range that looks a lot like north dakota … flat on flat.
free markets are only bubble generators and bust creators, so the flat horizon will drive a lot of investors nutty. there will be ranting about the heavy hand of regulation and many relatively small speculative burps and bubbles in the margin. soy futures, anybody?