US Factory Orders: Positive details show momentum for Q4 - Wells Fargo

Factory orders pulled back in October, dipping 0.1% after September’s upwardly revised 1.7% increase, shipments were up strongly, hinting at a solid start to Q4 GDP according to analysts at Wells Fargo. 

Key Quotes: 

“After back-to-back gains of more than 1 percent the previous two months, factory orders edged back in October. Total orders slipped 0.1 percent as a decline in durables more than offset a 0.7 percent rise in nondurables.”

“Following the upward revisions to September, orders continue to suggest another solid quarter of equipment spending in Q4 GDP despite the headline slip.”

“The pullback in durables was led by the volatile aircraft segment, but core capex orders rose 0.3 percent after an upwardly revised gain of 2.3 percent in September. That gauge of upcoming equipment spending in GDP calculations is running at a multiyear high of 16.4 percent 3-month annualized rate. Core capital goods shipments, a proxy for current equipment spending, are also running at a multi-year high annualized rate of 14.7 percent.”