US factory orders likely rose 0.6 percent in June

IndustrialsAssociated Press

The Commerce Department reports on U.S. factory orders in June at 10 a.m. Eastern time Tuesday.

GAINS LIKELY: Economists expect orders to have risen 0.6 percent in June, according to a survey by FactSet. Factory orders fell 0.6 percent in May, after three straight months of gains.

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FACTORIES STRONGER: Manufacturing picked up momentum in June, according to separate government report on orders for durable goods such as commercial aircraft and industrial machinery.

Orders rose 0.7 percent in June for these longer-lasting products. They're up 3.5 percent over the same period last year.

Demand for transportation products increased 0.6 percent, led by a solid 8.2 percent gain in orders for commercial aircraft. But aircraft can be volatile month to month. The less-volatile capital expenditures rose 1.4 percent in June, after falling 1.2 percent in May.

Orders for machinery rose 2.4 percent in June, while demand for primary metals such as steel increased 0.9 percent.

The improved outlook for business spending helped drive growth. The economy grew at an annual rate of 4 percent in the April-June quarter, after slipping 2.1 percent during the first three months of the year when brutal winter weather closed some assembly lines.

Manufacturing has rebounded as the weather improved.

The Institute for Supply Management, a trade group of purchasing managers, reported Friday that its manufacturing index rose to 57.1, up from 55.3 in June. A reading above 50 signals that manufacturing is growing.

The increased demand has fueled hiring. The Labor Department said Friday that employers added more than 200,000 jobs in July for the sixth straight month. Factories accounted for 28,000 new jobs in July. Over the past year, manufacturers have added 178,000 jobs, best 12-month stretch of hiring since November 2012.