Durables Orders Good For Stocks And Economy

Orders for durable goods rose 0.4% in January, the Census Bureau reported this morning. Economists surveyed by Briefing.com had projected a 0.6% decrease. Ex-transportation new orders, which means excluding volatile aircraft orders (for January remember and therefore this doesn’t include the effects of the recent Boeing 737 Max crash), fell 0.1% against projections for a 0.1% increase.

Most importantly for those of us trying to read the strength of the U.S. economy, new orders for capital goods–the equipment that businesses buy to make more things–climbed 1.8% in January, following a 2.1% increase in December. Orders for non defense capital goods, excluding aircraft, rose 0.8%.

The orders for capital goods increase will add to first quarter GDP growth.

As of 12:30 p.m. New York time, the Standard & Poor’s 500 index was up 0.79% to break above the 2800 level to 2813.57. If the index closes above 2800 it will be an important sign that this rally has further to run. The Dow Jones Industrial Average was up 0.58%. The NASDAQ Composite climbed 0.86%, as technology strength continued, and the Russell 2000 small cap index climbed 0.61%.

China’s Shanghai market moved lower by 1.01%.

The yield on the 10-year Treasury ticked up 1 basis point to 2.61%. The Dollar Spot Index dipped 0.20%.

U.S. benchmark West Texas Intermediate climbed 1.78% to $57.88 a barrel. International benchmark Brent crude gained 0.73% to $67.16 a barrel.

The CBOE S&P 500 Volatility Index (VIX) continued to fall, dropping another 1.38% to 13.58. Gold gained 0.78% to $1308.20 an ounce.