MNI ANALYSIS:US September Factory Orders +1.4%;Ex-Trans +0.7%>

--Factory Inventories Up 0.7%; Business Inventories Tracking Flat

By Sara Haire and Holly Stokes

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

1.4% in September, rising slightly higher than the expected 1.2% rise by 

analysts from an MNI survey. Nondurable goods orders rose 0.8%, but 

durable goods orders were revised down to a 2.0% increase from a 2.2% 

increase, data released by the Commerce Department Friday morning 

showed. 

     Petroleum and coal products shipments rose by 5.0% in September, 

leading the increase in nondurables orders. Nondurables shipments are 

equivalent to orders in this report. 

     Total factory orders excluding transportation rose 0.7% in 

September, while durable goods orders excluding transportation were up 

0.7%, unrevised from the 0.7% increase in the advance estimate. 

     Transportation orders for September rose 4.7% based on Friday's 

data, down slightly from the 5.1% gain in the advance estimate from the 

durables report released October 25. Nondefense aircraft orders rose by 

30.8% in September and defense aircraft orders were up 2.5%. Motor 

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

rose by 33.2%. 

     Nondefense capital goods new orders saw a 6.4% increase, but 

were up only 1.7% when a 62.3% increase in the civilian aircraft 

capital goods category is excluded. 

     Overall factory shipments were up 0.8% in the month due to a 0.9% 

rise in durable goods shipments and a 0.8% increase in nondurables 

shipments. Shipments for nondefense capital goods rose 2.5% and 

were up 0.9% excluding aircraft component. 

     Factory inventories were up 0.7% in the month, compared with 

the 0.8% increase in shipments, making the inventory-to-shipments 

ratio stay at 1.38. 

     The Commerce Department's advance report on inventories showed a 

0.3% increase for wholesale inventories and a 1.0% decline for retail 

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

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

result in a flat reading in September for business inventories when that 

report is released on November 15, an MNI calculation showed. The 

revised wholesale data for September will be released on November 9 and 

could alter this projection. 

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

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