Photo: Reuters/Andy Buchanan

Overall nondefense capital goods orders are still running at an 8% growth rate year on year; this in my view is more indicative than the volatile month-to-month data. It is an improvement but hardly a boom, and it suggests that the Trump tax cuts will mainly return money to shareholders rather than foster an investment boom.

The sector breakdown of industrial orders is only available through Dec. 31, a month behind the headline data, but there is a clear pattern: Oilfield and construction equipment are surging. Industrial equipment, though, is up about 8% year on year, and materials handling equipment did the same. After a substandard recovery characterized by low CapEx, this is a lopsided and disappointing result: Like the 2012-2014 investment boom in oil, when about 30% of S&P 500 CapEx went into energy, industrial orders appear to be dominated by energy. That is not an encouraging sign for productivity growth. The data are shown graphically as a three-month rolling average.

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