• Prior month -4.5% revised to -4.0%
• Advanced Durable goods orders for June 03% versus 2.5% estimate
• Durable goods ex transportation 0.6% vs 0 8% estimate. Prior month 1.8%
• Durable goods ex defense 0.3% versus -4.3% last month. Prior month -4.3%
• Nondefense capital ex air 0.9% versus 0.8%. Prior month +1.9%

Details of shipment, inventories:

• Manufactured durable goods shipments rose $2.4 billion (+0.7%) in June to $330.7 billion, following a 1.1% increase in May. Positive.
• Computers and electronic products led shipment gains, rising $0.8 billion (+2.4%) to $34.7 billion, marking the ninth consecutive monthly increase.
• Unfilled orders increased $9.3 billion (+0.6%) to $1.590 trillion, after a 0.7% gain in May.
• Transportation equipment led the increase in unfilled orders, rising $4.1 billion (+0.4%) to $1.002 trillion.
• Unfilled orders have increased in 23 of the last 24 months.
• Inventories of manufactured durable goods rose $2.0 billion (+0.3%) to $602.0 billion, following a 0.1% increase in May.
• Transportation equipment inventories increased $0.6 billion (+0.3%) to $190.6 billion.
• Durable goods inventories have increased for nine consecutive months.
• Nondefense capital goods
  • New orders: +$1.2 billion (+1.2%) to $97.8 billion.
  • Shipments: +$1.4 billion (+1.5%) to $95.0 billion.
  • Unfilled orders: +$2.7 billion (+0.3%) to $950.1 billion.
  • Inventories: +$0.6 billion (+0.2%) to $252.4 billion.
• Defense capital goods
  • New orders: +$0.1 billion (+0.5%) to $22.7 billion.
  • Shipments: +$0.8 billion (+4.0%) to $19.5 billion.
  • Unfilled orders: +$3.2 billion (+1.4%) to $224.7 billion.
  • Inventories: Down less than $0.1 billion (-0.1%) to $28.2 billion.

SUMMARY: 

The June durable goods report was slightly disappointing overall. Headline orders rose just 0.3%, missing expectations for a stronger rebound after May’s sharp decline. Excluding transportation, orders were little changed, suggesting underlying manufacturing demand remains somewhat soft. Shipments, inventories, and unfilled orders all continued to rise, indicating factories are still producing and filling backlogs, but the report lacked the broad-based strength that would point to a meaningful acceleration in manufacturing activity.

One bright spot came from nondefense capital goods excluding aircraft—often referred to as core capital goods. Orders for this category increased in June, a positive sign because it is viewed as one of the best indicators of business investment and corporate spending plans. Unlike the volatile aircraft sector, core capital goods reflect purchases of machinery, computers, communications equipment, and other productive assets that businesses buy to expand capacity and improve productivity. Because it strips out the large swings in defense and aircraft orders, economists and the Federal Reserve often place greater weight on this measure when assessing the health of business investment and the underlying economy.

One important reminder for traders is that today’s durable goods report is only the first estimate. The data will receive its first significant revision with the Factory Orders report in early August, which incorporates more complete survey responses and often results in meaningful changes. The figures will then be revised again with next month’s durable goods release as additional data become available. As a result, today’s report should be viewed as a preliminary snapshot rather than the final word on U.S. manufacturing activity.

US stocks in pre-market trading remains elevates with future implying:

• Dow +511
• S&P is up 48 points.
• Nasdaq +300 points

This article was written by Greg Michalowski at investinglive.com.