U.S. June durable goods orders increased 0.8%, their second gain in a row, beating market expectations for no growth or a slight dip. Nonmilitary orders rose 0.1%, and ex-transportation increased 2.0%. The latter is now up in three of the last four months.

Strength was seen in machinery orders, up 2.3%, primary metals at a 5.1% increase — the biggest gain since July 2007— and electrical equipment up 5.0%. Computers were the weak component with a 0.5% decline, and the subset of communications equipment was off 4.4%.

Boeing Corp. reported 62 new orders for commercial aircraft, versus 67 in May, and overall nonmilitary civilian aircraft orders were unsurprising at down 25.1%. Military aircraft orders fell 8.6%. These components were why overall transportation orders fell 2.6%.

However, autos and parts orders jumped 1.8% after two months of decline. This came in the face of weak unit auto sales, suggesting lots of repairs are being made to existing cars. The gain in auto orders was the largest since July 2007’s 6.3% gain, further suggesting that it is merely a rebound.

Nonmilitary capital good shipments were up 0.5% and their second-quarter level appears to be rising, suggesting an increase to gross domestic product from capital equipment spending.

Overall shipments advanced 0.5% and inventories were up 0.5% as well.

— Market News International

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