US factory orders drop, but investment up

    Orders to U.S. factories fell for the first time in five months in November, but much of the weakness reflected a swing in the volatile category of commercial aircraft. And a key category that tracks business investment spending posted an increase.

    As The Associated Press reports, factory orders dropped 2.4% after a 2.8% rise in October, the Commerce Department says. It was the first decline since June, but the weakness was led by a 73.8% plunge in demand for commercial aircraft following a 94.5% surge in October.

    A key category that serves as a proxy for business investment spending increased 0.9% after a half percent rise in October. This category has lagged for much of this year as a result of big cutbacks in the oil and gas industry.

    Orders for durable goods, items expected to last at least three years, fell 4.5%, only a slight revision from a preliminary report showing a drop of 4.6%. Orders for nondurable goods such as chemicals, paper and clothing were down 0.2% following a 0.6% increase in October.

    The 0.9% increase in business investment, while still modest, was the third best showing this year, and it marked the first back-to-back gains since July and August.

    The increases could be a sign that businesses are beginning to invest again after more than a year of cutbacks that have weighed on the economy.

    The Associated Press has the full story.

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