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Factory orders jump
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August 3, 2000: 10:20 a.m. ET
Aircraft orders help buck trend of reports indicating economic slowdown
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NEW YORK (CNNfn) - Factory orders bucked signs of a slowing economy, as a government report Thursday said their rate of growth hit a nine-year high in June.
Transportation orders drove the increase, which would have been basically flat without that sector's contribution.
 Overall new orders rose to $409.2 billion, an increase of $21.3 billion, or 5.5 percent, from revised May levels.
The gain was roughly in line with expectations. Analysts surveyed by Briefing.com forecast factory orders would rise 5.0 percent, but the service's own estimate called for a 6.0 percent gain. Both figures were above the revised 4.7 percent increase reported in May.
The Commerce Department report said it is the highest rate of increase since a 7.3 percent increase in July 1991.
Signs of a slowing economy have cheered investors in recent months, as they interpreted the reports as a sign that the Federal Reserve would again refrain from raising interest rates when it meets Aug. 22.
U.S. stock markets Thursday were sharply lower even before the report's release.
Still, some economists suggested this latest report might not be a strong argument against a slowdown in the economy.
"The signals in the manufacturing sector have become quite mixed," Steven Wood, economist for Banc of America, said. "The diffusion indices suggest a slowing pace of growth while the factory and durable goods reports indicate an acceleration. In the past, when this type of divergence has occurred, the diffusion indices have usually been the better indicator."
Electronic components orders slipped slightly in June to $47.2 billion after a 28 percent increase in May. Computer and office equipment orders fell 1.5 percent, but they remained 10.5 percent ahead of the level of three months ago.
The report also said inventories increased $2.4 billion, or 0.5 percent, to $481.8 billion following a 0.3 percent May increase. This is the ninth increase in the last 10 months. 
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Department of Commerce
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