U.S. Factory, Housing Sectors Offer Some Upbeat June Data

Orders for long-lasting U.S. manufactured goods shot up in June at the fastest rate in five months and sales of new homes hit a record, reports showed Friday, boosting optimism that the recovery is gaining speed.

However, a report from a housing industry group suggested that the recent uptick in long-term interest rates may be casting some gloom on the hot sector. In addition, economists noted that the durable goods report is often volatile and subject to sharp revision, especially with many factories shutting down for retooling in July.

“This [durable goods] report is on the strong side and adds weight to the general trend in economic statistics toward better results,” said Sherry Cooper, chief economist at BMO Nesbitt Burns.

The Commerce Department said sales of new single-family homes rose 4.7% to a record annual rate of 1.160 million, surprising Wall Street analysts, who had expected sales to slip to a rate of 1.120 million.

In a separate report, the National Assn. of Realtors said sales of existing homes edged down 0.3% last month to a pace of 5.83 million units, falling short of analysts’ expectations, and inventories jumped to their highest level in nearly 12 years.

The Commerce Department said orders for durable goods rose 2.1% to a seasonally adjusted $172.5 billion last month after being flat in May. The June pickup beat economists’ forecasts of a 1% gain and implied a recovering industrial sector.