Durables surge past expectations; jobless claims tick higher

Valley Appliance employees Dennis Husser, left, and Dan Arkels deliver a Maytag Corp. electric stove to a customer in Princeton, Illinois, U.S.
Daniel Acker | Bloomberg | Getty Images
Valley Appliance employees Dennis Husser, left, and Dan Arkels deliver a Maytag Corp. electric stove to a customer in Princeton, Illinois, U.S.

A gauge of planned U.S. business spending rose more than expected in June and new orders for long-lasting manufactured goods surged, offering tentative signs of a pickup in economic activity. Meanwhile, the number of Americans filing new claims for jobless benefits rose slightly last week in a sign the U.S. labor market continues to improve at a moderate pace.

The Commerce Department said on Thursday non-defense capital goods orders excluding aircraft, a closely watched proxy for business spending plans, increased 0.7 percent after rising by a revised 2.2 percent in May.

Economists had expected this category to only rise 0.5 percent after a previously reported 1.5 percent gain in May.

Orders for long-lasting manufactured goods jumped 4.2 percent as demand for goods ranging from aircraft to machinery improved. Orders for these goods, which range from toasters to aircraft, had increased by a revised 5.2 percent in May.

Economists polled by Reuters had expected orders for durable goods to rise only 1.3 percent after a previously reported 3.7 percent increase the prior month.

The gains in both the so-called core capital goods and durable goods orders were consistent with other manufacturing data that have suggested factory activity is regaining some momentum after hitting a soft patch earlier this year.

(Read more: US Layoffs Rise in June, but the First Half Improves)

The sustained gains bolster expectations of a re-acceleration in economic growth in the second half of the year.

Last month, shipments of core capital goods— used to calculate equipment and software spending in the gross domestic product report, fell 0.9 percent. That followed a 1.9 percent increase in May and pointed to moderate growth in business spending on capital equipment in the second quarter.

Last month, demand for transportation equipment increased 12.8 percent, buoyed by a surge in orders for civilian aircraft.

Boeing received orders for 287 aircraft, adding to May's 232 tally, according to information posted on its website. Orders for motor vehicles advanced 1.3 percent after falling 0.8 percent the prior month.

Orders excluding transportation were flat. There were gains in orders for machinery and fabricated metal products. However, orders for computers and electronic products, and electrical equipment, appliances and components fell.

Jobless claims rise

Initial claims for state unemployment benefits increased by 7,000 to a seasonally adjusted 343,000, the Labor Department said in a separate report Thursday.

Readings for jobless claims can be volatile in July because many factories close to retool during the period, and it is difficult for the government to adjust the data for seasonal swings because the shutdown schedule varies from year to year.

Still, a four-week average of new claims, which smooths out volatility, fell 1,250 from a week earlier.

The data reinforces the view that the labor market is weathering this year's tax hikes and federal budget cuts, which appeared to drag heavily on economic growth during the first half of the year.

A Labor Department analyst said there was nothing unusual in the data and that no states had provided estimates.

Economists polled by Reuters had expected first-time applications to rise to 340,000 last week. Claims for the prior week were revised to show 2,000 more applications received than previously reported.

The U.S. labor market has shown signs of strength in recent weeks, with 195,000 jobs added to payrolls in June. This has fueled expectations the Federal Reserve will start winding down its massive stimulus program as early as September.

At the same time, Fed Chairman Ben Bernanke has said the Fed would only begin withdrawing its support if the economy improves as much as policymakers expect.

(Read more: Has Bernanke perfected balance between hawks and doves?)

The claims report showed the number of people still receiving benefits under regular state programs after an initial week of aid fell 119,000 to nearly 3.0 million in the week ended July 13.