US factory orders fall in October

Factory orders dropped 0.9 percent from September, while orders for durable goods -- big-ticket items such as aircraft, cars and computers -- tumbled 3.4 percent, the Commerce Department said.

The report was better than expected, with most analysts forecasting orders fell 1.3 percent.

September orders were revised up to 3.0 percent, sharply higher than the 2.1 percent initially estimated.

Excluding the transportation sector, which can be volatile, factory orders slipped only 0.2 percent in October.

"This is typical of the manufacturers report where orders have fallen in the first month of the quarter before rebounding during the second two. We expect this pattern to continue through the end of the year," Briefing.com analysts said in a client note.

Transportation equipment, such as cars, trucks and airplanes, plunged 5.2 percent, leading the decline in durables.

Orders for non-durable goods such as food, clothing and energy products edged up 1.5 percent, from 1.4 percent in the prior month.

Manufacturing, a key driver of the economy's struggling recovery from recession, has shown recent signs of fatigue.

In a report Wednesday, the Institute of Supply Management said the manufacturing sector expanded for a 16th consecutive month in November but at a slightly slower pace than in October.

The ISM's purchasing managers index stood at 56.6 percent in November, the second-fastest rate of growth in the last six months, but down from 56.9 percent in October.

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