August 4, 2004 11:00 AM, EDT

Factory Orders Increase 0.7% in June

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rders at U.S. factories rose 0.7% in June, the second straight monthly increase, the Commerce Department said Wednesday.

Manufacturers received $363.2 billion in orders in June, which followed a revised 0.4% increase the month before. Excluding transportation equipment, orders rose 0.1% in June after rising 0.8% in May, Commerce said.

Rising orders translate to more demand for trucking services because factories use trucks to ship raw materials and finished products.

Economists had predicted that factory orders would rise 0.5%, Bloomberg reported. The May decline had been initially reported at 0.3%.

Through the first half of 2004, orders were up 11%, compared with a year earlier.

Bookings for durable goods, which account for more than half of orders, rose 0.9%, Commerce said. Orders for non-durable goods, which include industrial chemicals, drugs and plastics, rose 0.5%.

Orders for non-defense capital goods excluding aircraft, a proxy for future business investment, rose 1.1% in June.

Factory inventories rose 0.7% in June, same as in May. The inventory-to-shipments ratio, a measure of how long supplies on hand would last at the current sales rate, held at 1.23 months' supply.