Factory Orders Slip 0.2 Percent In June

Factory orders fell in June for the fourth time in five months, pulled down by slipping demand for aircraft and communications equipment.

In a hint of economic strength, jobless-benefit claims took a surprising tumble on the eve of a key employment report. Analysts said the drop may be due largely to an end to seasonal layoffs in the auto industry and not a broader trend.

The Commerce Department said Thursday that orders to U.S. factories slipped 0.2 percent in June after advancing 2.5 percent in May, the only gain since January.

The Labor Department reported the number of American workers filing first-time claims for jobless benefits fell by 51,000 last week, the largest drop in a year. They fell by 44,000 the previous week.

The decline in manufacturing this spring has been attributed to trimming of excess stockpiles. Analysts said businesses are well on the way to achieving the reduction and expect an upswing in production this quarter.

The economy came to a standstill in the April-June quarter and, according to the latest government figures, actually shrank a little.