Salient to Investors:

Orders for capital goods excluding aircraft and military equipment increased in May, a third consecutive advance and the longest streak since October 2011. The Business Roundtable’s quarterly outlook index rose in Q2 to the highest in a year.

Yelena Shulyatyeva at BNP Paribas said investment will pick up in half2 on strength in housing and autos, as to be profitable in the future, companies need to invest. Shulyatyeva expects capital expenditures to accelerate at a 6.9 percent annualized pace in Q3 and 7.6 percent in Q4 versus 4.4 percent in Q2 2013 and 0.1 percent in Q1 2013.  Shulyatyeva said abbreviated and canceled shutdowns show automakers are really ready to invest in capacity, invest in production.

BNP estimates GDP will grow 2.2 percent in Q3 2013 and 2.4 percent in Q4 versus 1 percent Q2 2013.

The FRB of San Francisco’s Tech Pulse Index rose in May to the highest since August 2008.

Michael Carey at Credit Agricole CIB said the capital-goods orders outlook for 2013 is okay, but not great, in the mid-single-digit range, and expects GDP growth of 1.3 percent in Q2, 2.4 percent in Q3, and 2.9 percent in Q4. Carey said for businesses to make bigger capital investments, they need to see stronger consumer demand and sales.

The IMF cut its global growth forecast to 3.1 percent in 2013 versus 3.1 percent in 2012.

Ted Wieseman at Morgan Stanley the economy is less interest-rate-sensitive as households have repaired their balance sheets and home affordability has surged.

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