December factory orders fell 0.7%, in line with estimates

"If we strip out transportation, it becomes a positive number... New orders, nondefense ex air proxy for capital spending comes in a strong 8/10... Shipments... 1% would be the strongest read since September of last year." While the headline number appears negative (-0.7%), it is entirely dragged down by the volatile transportation sector. The "CapEx proxy" (business investment) and shipments data are actually accelerating and beating expectations. This indicates that the core industrial economy is healthier than the headline suggests, favoring industrial stocks over the broad headline narrative. Long Industrials/Manufacturing to capture the underlying strength in business spending. If the weakness in transportation orders (likely aircraft) signals a broader slowdown in high-ticket items that eventually bleeds into other sectors.