WASHINGTON — Orders to U.S. factories for big ticket durable goods climbed 1.1% in September, the first increase in three months, the government said Tuesday, but analysts predicted that the upturn would be short lived because of adverse effects from the stock market turmoil.
The Commerce Department said orders for durable goods, items expected to last three or more years, rose to $107.8 billion last month, the first improvement since a 2% advance in June.
Orders showed no improvement in July and fell 2.4% in August.
While the September advance would normally be read as a positive sign for the economy, indicating increased demand for manufactured goods, analysts said that the collapse of the stock market over the past week had made them much more pessimistic.
"If we did not know that the stock market had crashed, most economists would conclude that the future for 1988 was very bright, but the stock market has changed that point of view," said John Hagens, senior economist at Wharton Econometrics in Bala-Cynwyd, Pa.
He said orders in coming months were likely to decline as businesses, worried about a possible recession next year, scale back expansion plans.
Shipments of durables rose 3% in September, the largest increase since a 4.3% rise in February.