MNI DATA ANALYSIS: US September Factory Orders Up 0.7%>

--Factory Inventories +0.5%; Business Inventories Tracking +0.3%

By Shikha Dave and Harrison Clarke

     WASHINGTON (MNI) - The value of new factory orders rose 0.7% in 

September, above the 0.5% increase expected by analysts in an MNI 

survey, data released by the Commerce Department Friday morning showed. 

     Durable goods orders were revised down slightly to a 0.7% gain from 

the 0.8% increase reported in the advance estimate. Nondurable goods 

orders rose 0.6% on gains in petroleum and coal, chemical products, and 

plastics and rubber products. Nondurable goods new orders are equivalent 

to nondurable goods shipments in this report. 

     Factory orders excluding transportation were up 0.4% in the month 

following a 0.4% gain in August, continuing the string of gains that 

stretches back virtually uninterrupted for most of the past two years. 

Durables orders excluding transportation were revised down to a flat 

reading from the 0.1% gain in the advance report. 

     In addition, unfilled orders were +0.8% in September, showing 

steadily growing demand for products. 

--TRANSPORTATION ORDERS RISE

     Transportation orders were up 1.9% in September, unrevised from the 

advance estimate. The unlisted transportation components were down 2.4% 

in the month, based on an MNI calculation. 

     Nondefense capital goods new orders fell by 2.3%, however they were 

down only 0.1% when excluding aircraft. 

--INVENTORIES, SHIPMENTS UP

     Factory inventories rose by 0.5% in September. In addition to this, 

the Commerce Department's advance report on inventories showed a 0.3% 

gain for wholesale inventories and a 0.1% rise in retail inventories. 

     While these data are eligible for revision, the levels as they 

stand now, combined with the 0.5% increase in factory inventories, would 

result in a 0.3% gain in September 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. 

     Overall factory shipments were up 0.9% in the month on a 1.2% 

increase for durable goods shipments, complimented by a 0.6% rise in 

nondurable shipments. Nondefense capital goods shipments posted a gain 

of 2.6%, but were down 0.1% after excluding the civilian aircraft 

component. 

     Given the mix of inventories and shipments reported Friday, the 

inventory-to-shipments ratio fell to 1.33 in September from 1.34 in 

August. 

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

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