General

New orders for manufactured products rose for the second month in a row in April, according to the U.S. Census Bureau.

What’s going on: New orders inched up 0.4% in April, following a 0.6% gain in March.

• Durable goods orders increased 1.1%, owing mostly to a rise in defense aircraft and parts orders, which can be volatile from month to month.
• Excluding transportation equipment, factory orders dipped 0.2% in April, the third straight month of declines.

The big picture: Overall, orders for new manufactured goods have declined 2.6% since peaking a year ago.

• With factory orders (excluding transportation) down 4.3% over the past 10 months, manufacturing activity has contracted notably since last summer.

The good news: New orders for core capital goods (nondefense capital goods excluding aircraft) rose 1.3% in April after two straight months of declines.

• Core capital goods orders are considered a proxy for capital spending in the U.S. economy. These totaled $73.982 billion in April, just under the record $73.985 billion in December and signifying 2.5% year-over-year growth.

Factory shipments: Factory shipments decreased 0.4% in April, the third straight month of declines.

• Overall, total factory shipments have declined 2.9%—or 4.2% excluding transportation equipment—since peaking a year ago.
• However, core capital goods shipments rose 0.5% in April to $73.848 billion, just slightly under January’s record of $73.850 billion. Core capital goods shipments have risen 4.1% year-over-year.