US factory orders show weak rise

US factory orders recorded their smallest rise for three months in May, reflecting declining demand for cars, heavy machinery and steel.

Factory orders rose 0.6%, less than half the rises seen in April and March, according to the Commerce Department.

The fall would have been bigger without the support of transportation orders, which rose 2.5% on the back of rising orders for aircraft.

Excluding transportation orders, factory orders only rose by 0.4%.

Analysts said that the figures were also boosted by the price of oil.

"The data if anything is a little inflated by the increase in the nominal price of oil for the petroleum guys in the sample," said Carl Lantz from Credit Suisse in New York.

Others said that a positive reading of any kind was an encouraging sign.

"The fact that they're still showing expansion is definitely a positive," said Edward Bretschger from Calyon Securities.

"A positive data point like this may be what need to stave off the technical definition of a bear market."

RELATED INTERNET LINKS
Department of Commerce
The BBC is not responsible for the content of external internet sites