US Factor Orders: A larger-than-expected decline in May - Wells Fargo

According to analysts from Wells Fargo, the 0.8% decline in May factory orders and durable goods orders, was in part because of the volatile transportation sector. 

Key Quotes: 

“May’s larger-than-estimated decline of 0.8 percent followed a downwardly revised 0.3 percent dip in April, reiterating the tempered assessment of factory activity from last week’s durable goods report.”

“Orders declined on the month for most categories, but the volatile transportation equipment sector stood out as a major driver of May’s decline, dropping 3.0 percent on the month.”

“Nondefense capital goods orders ex-aircraft, a key benchmark for future business spending, were up 0.2 percent in today’s final report, an improvement from last week’s durable goods report which showed little activity in the pipeline in May.”

“Though positive in May, orders and shipments of core capital goods are at their softest 3-month pace of 2017. Recent readings from the ISM suggest activity may ramp up next month.”