Factory Orders Preview

The Department of Commerce will release Factory Orders at 10:00 ET, with a consensus expectation for a gain of 1.7 percent, and a range form 0.7 percent to 2.5 percent according to Bloomberg News. This would be an improvement over last month's reading of -1.0 percent. Much of this month's expected gain is attributable to aircraft sales, which have been unusually strong recently. Economists may likely look at Factory Orders ex-transportation as a better gauge of the overall economic picture. Factory Orders have been stubbornly weak over the past year, with only one month showing a positive number. Oil sector weakness, along with the strong dollar dampening export demand, have been two of the biggest drags on orders. With oil prices continuing to fall and the dollar continuing to strengthen, Factory Orders may continue to languish. Following yesterday's weak ISM number, which pointed to slower economic growth, a weaker than expected Factory Order report today may give the Federal reserve further reason to delay raising interest rates. In front of the Factory Orders release, S&P 500 futures are trading lower by 0.2 percent.