Aircraft are an important piece of the manufacturing sector but aircraft orders, which are clumpy, often make factory data hard to read. A 5.2 percent decline in factory orders for August is a scary result but when excluding transportation equipment, which is where aircraft is classified, orders actually rose in the month, up a second straight 0.7 percent.
A narrower look at the capital goods group, a group that offers signals on business investment, shows a dramatic 24.4 percent monthly plunge in orders, which however that turns into a welcome 1.1 percent gain when excluding aircraft. But other signs on capital goods are not positive including a second straight monthly dip for shipments both including and excluding aircraft.
Factory order data are notoriously volatile month to month, which may be good news for the September report which will have a very easy comparison. And more recent data do show improvement for September based at least on the ISM and Philly Fed, which are two prominent reports that offered early warnings of turbulence for the factory sector.