By
updated 5/3/2011 3:23:51 PM ET 2011-05-03T19:23:51

Businesses increased their demand for industrial machinery, computers and autos in March, lifting factory orders for the fifth consecutive month.

Major Market Indices

Orders rose 3 percent in March after a 0.7 percent increase in February, the Commerce Department reported Tuesday. A key category that signals business investment plans jumped 4.1 percent after a small increase in February and a big decline in January. Excluding the volatile transportation sector, orders rose 2.6 percent.

The March increase pushed total orders to $462.9 billion, up 31.2 percent from the recession low hit in March 2009.

Story: Manufacturing activity grows for 21st straight month

Analysts noted that the March increase was partly driven by higher oil prices that increased the costs of petroleum products.

But the report also supported evidence that the manufacturing sector has been one of the strongest segments of the economy since the recession ended nearly two years ago. On Monday, the Institute for Supply Management reported that manufacturing activity rose for a 21st straight month in April.

Joshua Shapiro, chief U.S. economist at MFR Inc. in New York, said the solid March increase in factory orders showed the January-March quarter ended with momentum, an encouraging sign for future economic growth.

A weak dollar is making U.S. exports cheaper overseas and tax cuts are encouraging business investment in capital goods.

For March, orders for durable goods — items expected to last at least three years — rose 2.9 percent. That's slightly better than a preliminary estimate the government reported last week.

Demand for nondurable goods rose 3.1 percent. Petroleum products increased 7.8 percent. Much of that gain reflected higher prices.

Orders for transportation rose 6.2 percent. Demand for autos increased 4 percent, nearly double the 2.2 percent rise in February. Automakers are benefiting from rising sales over the past several months.

Orders for commercial aircraft rose 0.9 percent after much bigger increases in the previous two months.

Copyright 2011 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

Discuss:

Discussion comments

,

Most active discussions

  1. votes comments
  2. votes comments
  3. votes comments
  4. votes comments

Data: Latest rates in the US

Home equity rates View rates in your area
Home equity type Today +/- Chart
$30K HELOC FICO 4.96%
$30K home equity loan FICO 5.23%
$75K home equity loan FICO 4.66%
Credit card rates View more rates
Card type Today +/- Last Week
Low Interest Cards 13.28%
13.21%
Cash Back Cards 17.73%
17.70%
Rewards Cards 17.00%
16.96%
Source: Bankrate.com