Economic Reports 07/03/07

Summary: Headline spin, factory orders fall less than expected... under the sheets, the sequential decline continues for a 3rd month, as capital goods orders have gone in the tank.

As the housing debacle continues, pending home sales sinking to a five year low... perhaps they fell less than expected as well.

Factory Orders May -0.5% vs prior +0.5%
Full Report

Inside the number: April revised up from +0.3%. Shipments +1% vs prior +1%; Unfilled orders +0.9% vs prior +1.9%. All Manufacturing ex transportation YTD -1.1%

New orders: manufactured durables -2.4% vs prior +1%; inventories +0.1% (15 month build); Non durables +1.6% vs prior 0.0%; inventories (3 month build) +1.7%.

New orders: ex transportation +0.7% vs prior +1%; ex defense -0.6% vs prior +0.6%.

Construction machinery -17.2% vs prior -34.2%; YTD -30.9%. Industrial machinery -16.6% vs prior +9.6%; YTD +1.5%

The really bad news, sequential declines three months running in new orders. The little shop of horrors can be found in
Table 5:

New orders % change: All manufacturing March +4.1%; April +0.5%; May -0.5%. Capital goods March +12.5%; April -0.3%; May -6.4%.

Non defense capital goods March +13.8%; April -0.3%; May -7.6%. Ex aircraft March +4.6%; April +2%; May -2.1%.

Pending Home Sales May -3.5% vs prior -3.2%
Full Report

Inside the number: Index at 97.7 vs prior revised down to 101.2; Yoy -13.3%

West +5.6% to 95.4; Yoy -13.7%. Northeast, +3.8% to 93.1; Yoy -9.6%. South -7.6% to 107.2; Yoy -15.4%. Midwest, -8.9% to 89.4; Yoy -11.7%.

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