Factory Orders Tumble 2.9% in April

New orders for U.S. factory goods declined 2.9% in April to $320 billion, the biggest fall since November 2001, the Commerce Department said Thursday.

Since orders for factory goods are a harbinger of future production and shipments, the report appears to be a negative sign for the truck freight market.

Also Thursday, the Labor Department said the number of American workers filing new claims for jobless benefits rose by a seasonally adjusted 16,000 to 442,000 in the week ended May 31. (Click here for the full story.)

Factory orders had risen 2.1% in March. Analysts were expecting a drop of 1.5%, Reuters said.

Excluding the volatile transportation sector, orders fell 2.4%, the steepest decline since September 2001.

Commerce’s report showed sharp declines in demand for machinery, transportation and electrical equipment, while orders for computers and electronic products rose slightly.

Factory inventories were unchanged in April following a 0.2% drop in March. With shipments falling 2.2%, Commerce said the inventory-to-shipments ratio, a gauge of how long goods sit at factories, rose to 1.35 months, the highest since March 2002, from 1.32.

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