Durable goods orders' stunning 13.2% dive in August was largely due
to the volatile transportation sector, but Thursday's report revealed a
broad decline in business demand and investment as "fiscal cliff"
concerns mount.
Aerospace giant Boeing (BA) hit a temporary lull in orders, wiping out commercial aircraft demand last month. Autos fell 10.9%, the Commerce Department said.
But even excluding transportation, orders fell 1.6%, the sixth retreat in eight months. The dollar value was the lowest since April 2011.
U.S. stock indexes rallied sharply anyway on hopes that China will announce more stimulus and that Spain's new budget will lead to a crisis-easing sovereign bailout. Spain-related fears had hit equities in the prior two days.
Steep tax hikes and spending curbs are set to kick in at year-end, if lawmakers fail to reach a deal moderating them, making companies reluctant to invest until the uncertainty is lifted.
The fiscal cliff contributed to confidence among major CEOs tumbling to a three-year low. Defense contractors like Lockheed Martin (LMT) have warned of thousands of layoffs, if additional Pentagon cuts go into effect.
Last month, defense capital goods orders plunged 40.1%, after declining by nearly 15% in July. They are now at the lowest level since December.
A sluggish global economy and European debt crisis fears have also been head winds on U.S. firms, which pulled back on a wide array of durable goods last month.
Aerospace giant Boeing (BA) hit a temporary lull in orders, wiping out commercial aircraft demand last month. Autos fell 10.9%, the Commerce Department said.
But even excluding transportation, orders fell 1.6%, the sixth retreat in eight months. The dollar value was the lowest since April 2011.
U.S. stock indexes rallied sharply anyway on hopes that China will announce more stimulus and that Spain's new budget will lead to a crisis-easing sovereign bailout. Spain-related fears had hit equities in the prior two days.
Steep tax hikes and spending curbs are set to kick in at year-end, if lawmakers fail to reach a deal moderating them, making companies reluctant to invest until the uncertainty is lifted.
The fiscal cliff contributed to confidence among major CEOs tumbling to a three-year low. Defense contractors like Lockheed Martin (LMT) have warned of thousands of layoffs, if additional Pentagon cuts go into effect.
Last month, defense capital goods orders plunged 40.1%, after declining by nearly 15% in July. They are now at the lowest level since December.
A sluggish global economy and European debt crisis fears have also been head winds on U.S. firms, which pulled back on a wide array of durable goods last month.
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