By early afternoon in New York, the Dow Jones was trading at 15,042 up 0.21% or 31 points. Despite a positive couple of sessions back-to-back, the Dow is on course for its worst monthly performance since May.
A report from the Commerce Department showed that durable goods orders plummeted 7.3% in July, the biggest drop in close to a year. Expectations had been for a drop of 4% . The transportation component is notoriously volatile, but even excluding this, the core number fell 0.6%. This is a significant result, and has potentially big implications for the Fed’s decision of whether to taper next month or not.
Alongside mortgage rates that have been climbing and some signs of softness in the housing market, this may be enough to convince the Fed to either defer the start of tapering or begin to scale back stimulus by only the smallest of margins.