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Stocks are nosing slightly higher to start the week in a sluggish trading session for the Dow Jones Industrial Average (INDEXDJX:.
Durable-goods orders fall, but Boeing stays in stride
The day got off to a shaky start when U.S. durable-goods orders came in sharply lower for July. Total orders fell 7.3% for the first decline in four months. Economists had projected a drop of 4.7% based on lower airplane orders from The Boeing Company (NYSE:BA), but auto demand weakened as well. Even with transportation orders removed, durable-goods orders still contracted slightly in July as computers and electrical equipment orders fell sharply.
The Boeing Company (NYSE:BA) signed only 90 new contracts in July versus 287 in June. However, that hasn’t hurt the stock much today: Shares of the company have moved about 0.9% higher to rank among the Dow Jones Industrial Average (INDEXDJX:.DJI)’s leaders. While The Boeing Company (NYSE:BA)’s orders may have fallen, the new 787 Dreamliner remains on a strong pace despite all the negativity surrounding it this year. China’s Xiamen airlines called in an order for six of the aircraft last Friday after receiving approval from the Chinese government, and The Boeing Company (NYSE:BA) just recently unveiled the 787-9, a larger version of the craft.
Downbeat durable-goods orders aren’t a great sign for a manufacturing industry that has struggled to move past the recession, but Boeing is one of the best bets in this hard-hit sector. The company’s size and breadth have it squarely atop a growing global aerospace industry, and The Boeing Company (NYSE:BA)’s total backlog after the first half of the year stood at nearly $390 billion. That was an advance of about 4.5% over the firm’s backlog as of the end of 2012 and a sign that the company’s future prospects remain strong.
All eyes across the markets are still on Microsoft Corporation (NASDAQ:MSFT) after the company’s CEO, Steve Ballmer, announced last week that he will step down within 12 months — and the firm’s shares are down by about 1% today, ranking among the Dow’s hardest-hit laggards. Microsoft Corporation (NASDAQ:MSFT)’s stock soared following Ballmer’s resignation, but it’s impossible to dismiss the challenges that his successor faces when he or she takes over this company in transition.