Ahead of the Bell: Durable goods

By DANIEL WAGNER AP Business Writer

WASHINGTON (AP) - Orders for factory goods are expected to show a rise in June, fueled by renewed demand for Boeing aircraft. Excluding the volatile transportation sector, the number is expected to be almost flat.

Growth in many key manufacturing sectors has slowed as the economic recovery lost steam this summer.

Economists surveyed by Thomson Reuters expect orders for durable goods to rise by 1.0 percent. The Commerce Department will release the report at 8:30 a.m. EDT on Wednesday.

The increase in demand would follow May's decline of 0.6 percent. May orders were lower because orders for commercial aircraft like Boeing's dropped of sharply.

Excluding transportation, orders in May increased by 1.6 percent. Many companies invested ready cash in machinery and other capital goods.

Analysts say aircraft orders likely recovered in June. They expect that machinery orders leveled off after spiking in May. Orders for turbines - another volatile area - were up 37 percent in May.

Wednesday's report will give a sense of whether companies are keeping up that spending into the third quarter. A weak consumer confidence report this week has stoked fears that Americans may be losing faith in the recovery.

The nation's factories have helped to lead the economic recovery after the worst recession in decades. Companies rich with cash have been investing in new equipment, a key driver of durable goods performance. Workers have been hired back and worked longer hours.

However, the recovery looks increasingly uncertain amid high unemployment, stagnant wage growth and economic instability in Europe.