November durable goods orders data are out.
Total orders rose 3.5% in November, surpassing expectations for a 2.0% rise. October’s 2.0% decline was revised down to a 0.7% loss.
Orders of durable goods excluding transportation rose 1.2%, besting expectations for a 0.7% gain. The October rate of growth was revised up to 0.7% from -0.1%.
Orders of nondefense capital goods excluding aircraft (a.k.a. “core capex”) surged 4.5%, well above the 0.7% consensus estimate. October’s number was revised to -0.7% from -1.2%.
Shipments of nondefense capital goods excluding aircraft rose 2.8%, above the 1.0% consensus estimate, with October data revised down to -0.4% from -0.2%.
“With the market seeking evidence of a broadening economy since business investments has been one of the main missing components, November durable goods data provided such evidence,” says Adrian Miller, director of fixed income strategy at GMP Securities. “And yet, and you know there had to be an ‘and yet,’ we must remember that there are two expiring tax programs relating to investing in R&D and depreciation tax credit that allows companies to write off 50% of equipment purchases that expires at the end of the year. So we are likely seeing a rush of companies taking advantage of the looming deadline effectively pulling forward business spending.”
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