Factory Orders Showing Only Marginal Growth

The data on February Factory Orders has been released and the results are showing that orders were up 1.3% in the month.  While not a bad number, Dow Jones had estimates expected to be up by 1.5%.  It was also tempered by the January report showing a factory orders revision was lower down to -1.1% from a preliminary figure of -1.0%.

February’s data was also lower if you take out the more volatile readings.  On an ex-defense basis the orders came in +1.1%.  On an ex-transportation basis the orders came in at only +0.9%.

It should be noted that today’s data highlights a report measuring February and we have already seen better ISM data on manufacturing for the month of March.  That might not temper some cautious optimism today but it does need to at least be kept in mind that there is newer data out.

The DJIA did drop on the news but only marginally and the market appears to have ticked back up.  With a one-month lag on the orders data we generally downplay the importance here compared to a same-month release of more current or live data.

JON C. OGG