ANALYSIS: US June Factory Orders rise 3%; Ex-Trans -0.2%>

--Factory Inventories +0.2%; Business Inventories Tracking +0.4%

By Sara Haire and Holly Stokes

     WASHINGTON (MNI) - The value of new factory orders rose by 3% in 

June, right on the target expectation by analysts from an MNI survey. 

Nondurable goods orders fell 0.3%, but durable goods orders were revised 

slightly down to a still strong 6.4% rise, data released by the Commerce 

Department Thursday morning showed. 

     Petroleum and coal products shipments fell by 2.7% in June, leading 

the decrease in nondurables orders. Nondurables shipments are equivalent 

to orders in this report. 

     Total factory orders excluding transportation fell 0.2% in June, 

while durable goods orders excluding transportation were up 0.1%, 

revised down from the 0.2% increase in the advance estimate. 

     Transportation orders rose 19% in June based on Thursday's data, 

unrevised from the advance estimate. Nondefense aircraft orders rose by 

131.1% in June and defense aircraft orders were down 0.3%. Motor 

vehicles orders rose 0.1% in June, while orders for ships and boats fell 

by 3.4%. 

     Nondefense capital goods new orders rose 21.1%, but were flat when 

a 228.7% rise in the civilian aircraft category is excluded. 

     Overall factory shipments were down 0.2% in the month due to a flat 

durable goods shipments and a 0.3% decline in nondurables shipments. 

Nondefense capital goods shipments rose 0.4% and were up 0.1% excluding 

the civilian aircraft component. 

     Factory inventories were up 0.2% in the month, compared with the 

0.2% decline in shipments, shifting the inventory-to-shipments ratio to 

rise to 1.38. 

     The Commerce Department's advance report on inventories showed a 

0.6% gain for wholesale inventories and a 0.6% rise for retail 

inventories. While these data are eligible for revision, the levels as 

they stand now, combined with Thursday's factory inventory data, would 

result in a 0.4% increase in June business inventories when that report 

is released on August 15, an MNI calculation showed. The revised 

wholesale data for June will be released on August 9 and could alter 

this projection. 

     ** MNI Washington Bureau: 202-371-2121 ** 

[TOPICS: MAUDS$,M$U$$$]