The manufacturing sector showed continuing momentum as new orders for U.S. durable goods rose for a third consecutive month in April. New orders increased by 0.8%, despite analysts' predictions of a 1.3% drop. Activity in the defense industry drove much of gain, however, while nondefense capital goods orders fell. "Year-to-date nondefense capital goods orders excluding aircraft are up 3.1% -- a modest pace of growth," says Daniel J. Meckstroth, chief economist for MAPI. "Business equipment order activity should pick up in the coming months."

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