New orders for long-lasting U.S. manufactured goods edged higher in December and the number of workers filing applications for jobless aid fell last week, indicating the economy remains on a recovery path, according to Reuters. The Commerce Department said on Thursday durable goods orders rose 0.3 percent last month, held back by a surprise drop in civilian aircraft orders that analysts saw as temporary. The gain lagged economists expectations for a 2 percent rise. Details of the report were much stronger, however, with a proxy for business spending plans -- non-defense capital goods orders excluding aircraft -- increasing a solid 1.3 percent. On the jobs front, the Labor Department reported that initial claims for state unemployment benefits dropped 8,000 to 470,000 last week, less than economists had expected, after rising for three weeks in a row. "We remain on track, but it's not a strong, strong recovery that would be consistent with the big downturn," said Kurt Karl head of economic research at Swiss Re in New York. Economists took encouragement from the orders for durable goods, those meant to last at least three years. "Businesses are now feeling confident enough to deploy a larger portion of the recent strong corporate earnings rebound into new investment spending," said Brian Bethune, chief U.S. financial economist at IHS Global Insight in Lexington, Massachusetts. While economists saw the day's data as having little impact on perceptions of an economy steadily recovering from the worst downturn since the 1930s, investors took a different view. U.S. stock indexes fell sharply, also weighed by the weak outlooks from tech firms Qualcomm Inc and Motorola Inc. The fall in stocks revived demand for the least risky U.S. government bonds, lifting prices for short-dated Treasuries.
