NEW YORK (CNN/Money) - Orders for goods made in U.S. factories rose in July, the government said Thursday, recovering from June's dramatic drop.

Factory orders jumped 4.7 percent in July to $327.6 billion after dropping a revised 2.5 percent in June, the Commerce Department reported. Economists expected orders to rise 4.7 percent, according to Briefing.com.

The data had little effect on U.S. stock prices, which fell in early trading, dragged down by other economic data showing weakness in the labor market and in the service sector of the economy. Treasury bond prices rose.

The gain in factory orders contrasts with Tuesday's report by the Institute for Supply Management (ISM) that U.S. manufacturing activity grew at an anemic pace in August.

Together, the data paint a mixed picture of business spending, which Federal Reserve Chairman Alan Greenspan and other economists have called crucial to the economy's recovery from a recession that began in March 2001.

Business spending dried up after a boom in the late 1990s, leading to a prolonged recession in the manufacturing sector, more than a million job cuts, and a recession in the broader economy.

In the Commerce Department report, manufacturers' inventories fell for the 18th straight month, dropping 0.1 percent to $427.8 billion, the lowest level since May 1997.

New orders for durable goods, such as cars and computers, which are meant to last three or more years, rose 9.2 percent to $180.5 billion. The government had previously reported that durable goods orders rose 8.7 percent in July.

But orders for non-durable goods fell 0.3 percent to $147.1 billion.