Big Surprise in Durable Goods

A350_XWBDurable goods is generally considered to be one of the most volatile economic reports issued each month. The Commerce Department also showed that durable goods was very strong on the headline data, but not so strong when you back out key transportation ticket items.

April's headline durable goods reading was up by 0.8%, much higher than the Dow Jones estimate of -0.7% and the Bloomberg consensus estimate of -0.8%. Durables were only up by 0.1% on an ex-transportation basis. Bloomberg had that estimate at -0.1%.

The transportation segment inside durable goods was up by 2.3% in April, but this was led by a 13.1% gain in defense aircraft orders.

Another key reading is the non-defense capital goods orders excluding aircraft, and this report fell by 1.2% in April. This segment's shipments were down by 0.4% as well.

Where the report's impact gets a bit complicated is that the headline report for March was revised up to 3.6% from a previous report of being up 2.5%.

Stocks have remained in positive territory on Tuesday morning, so the report is not creating many waves.

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Filed under: Economy
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