U.S. durable goods likely to have weakened in October

U.S. durable goods are expected to have declined in the month of October after rising strongly in September. Recent data from the factory sector have been quite optimistic. September’s final statistics showed that durable goods rose 2 percent sequentially. The data for August and September have been impacted to a certain extent by hurricanes and some payback might be seen in October. Durable goods orders are likely to have risen just 0.1 percent in October, noted Wells Fargo in a research report.

Looking through the disruptions, the road ahead appears generally positive for upcoming factory orders. Core orders in September rose 1.7 percent sequentially and 12.4 percent year-on-year, underpinning the outlook for a sound rate of equipment spending through year end, stated Wells Fargo.

Meanwhile, the October ISM manufacturing index had weakened a bit sequentially but continued to stay in strong growth character. The new orders index had also indicated towards growth in October.

“Still, there will likely be some payback from the distortion resulting from the hurricanes in October, but we remain upbeat about the underlying trend”, added Wells Fargo.

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