Factory Orders Take Sharp 1.1% Rise in Sept. Before Market Fall

New orders for U.S. manufactured goods and spending on construction rose significantly in September, the Commerce Department said today.

Factory orders rose by 1.1% in the month, higher than the 0.9% rise anticipated by financial analysts. Excluding orders for defense goods, which vary widely from month-to-month, orders rose 1.3%, the department said.

At the same time, the department said construction spending rose $6.2 billion, a 1.5% rise, to a seasonally adjusted annual rate of $406.3 billion.

Meanwhile, the Labor Department said productivity among the nation’s businesses improved by 2.6% in the July-September period.

Despite encouraging signs of growth represented by rising factory orders, construction spending and productivity, most economists believe the U.S. economy will slow significantly as a result of last month’s stock market collapse.

The data covers the month prior to the tumble in stock market prices, but other data suggested the U.S. economy, after nearly five years of growth, was beginning to slow even before then.

The government last week reported that U.S. leading indicators, a key gauge of future growth, fell by 0.1% in September.

The department said construction spending in September was also 1.5% higher than the September, 1986, level of $400.1 billion.