US Durable Goods Orders rose 2.6% in March above the 1.6% expected. Analysts at Wells Fargo point out that gains in aircraft orders offset weakness in other categories of business spending and they see no signs of near-term capital spending improvement.

Key Quotes: 

“Double-digit percentage gains in orders for both civilian and defense aircraft lifted overall durable goods orders to a better-than-expected monthly increase of 2.6 percent.”

“Machinery orders declined 1.7 percent—the second decline in three months. Excluding the volatile transportation sector, orders were unchanged in March. Despite sustained high levels for ISM new orders, actual orders remain inconsistent.”

“Core capital goods shipments tend to be a good indicator for equipment spending, and that does not bode well for tomorrow’s GDP report as this series posted a 0.7 percent decline in March and a 3-month annualized growth rate of just 4.1 percent.”