Durable Goods Orders Show Modest Growth in Oct.; Businesses Remain Cautious
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Overall Analyst Rating:
NEUTRAL (
Down)Dividend Yield: 2.3%
Revenue Growth %: +9.0%
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Orders for durable goods fell in October, but still came in better than expected.
According to new data from the U.S. Census Bureau, new orders for manufactured durable goods in October increased slightly to $216.9 billion. The flat result was down from a 9.2 percent gain in September and topped expectations calling for a dip of 0.4 percent. This is the fifth increase out of the last six months.
Excluding transportation, orders rose 1.5 percent versus the consensus of a 0.4 percent drop.
Nondefense capital goods rose 0.8 percent in October, while shipments popped 0.3 percent. Inventories, which have been up 33 of the last 34 months, rose 0.4 percent to $374.4 billion.
Communications equipment demand rose 11.4 percent, the largest jump since last February, while electrical equipment orders rose 4.1 percent, the largest pop since August 2011.
One HSBC analyst noted that demand has "stabilized" for durable goods.
The Commerce Department said no businesses surveyed reported disruption due to Hurricane Sandy.
Amid the overly positive data, markets are still a little wary on orders and economic stability moving forward. Equipment maker Deere & Co. (NYSE: DE) reported fourth-quarter results last week, missing views as margins crimped. It's outlook for fiscal 2013 wasn't anything to write home about either.
Also on investors' minds is the looming fiscal cliff, which could trigger $607 billion in new taxes if lawmakers don't find a solution by December 31st. The Fed has said recently it would keep key rates near zero to help boost growth, but Chairman Ben Bernanke hinted that the bank would need a little help from officials in keeping the economy stable.
U.S. markets are lower overall in early trading Tuesday.
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According to new data from the U.S. Census Bureau, new orders for manufactured durable goods in October increased slightly to $216.9 billion. The flat result was down from a 9.2 percent gain in September and topped expectations calling for a dip of 0.4 percent. This is the fifth increase out of the last six months.
Excluding transportation, orders rose 1.5 percent versus the consensus of a 0.4 percent drop.
Nondefense capital goods rose 0.8 percent in October, while shipments popped 0.3 percent. Inventories, which have been up 33 of the last 34 months, rose 0.4 percent to $374.4 billion.
Communications equipment demand rose 11.4 percent, the largest jump since last February, while electrical equipment orders rose 4.1 percent, the largest pop since August 2011.
One HSBC analyst noted that demand has "stabilized" for durable goods.
The Commerce Department said no businesses surveyed reported disruption due to Hurricane Sandy.
Amid the overly positive data, markets are still a little wary on orders and economic stability moving forward. Equipment maker Deere & Co. (NYSE: DE) reported fourth-quarter results last week, missing views as margins crimped. It's outlook for fiscal 2013 wasn't anything to write home about either.
Also on investors' minds is the looming fiscal cliff, which could trigger $607 billion in new taxes if lawmakers don't find a solution by December 31st. The Fed has said recently it would keep key rates near zero to help boost growth, but Chairman Ben Bernanke hinted that the bank would need a little help from officials in keeping the economy stable.
U.S. markets are lower overall in early trading Tuesday.
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