In the U.S., the Commerce Dept. reported Thursday that orders for durable goods rose 3.3% in January, the largest jump in six months, as the battered manufacturing sector struggles to turn around. Orders climbed to $174.78 billion last month.

Economists predicted a 1% gain. “While durables goods orders are a notoriously volatile indicator, this increase is nevertheless significant since it reflects business decisions made in a period of growing geopolitical risks,” says RBC Financial. “Better orders and broader business investment gains should come forth following a war or diplomatic resolution to the Iraq crisis — barring any increase in terrorist activity.”

“This confirms all the surveys showing January was a rebound month for U.S. factories,” notes BMO Nesbitt Burns. “The sources of growth are likely the weaker U.S. dollar, inventory rebuilding off a low level, and an unfolding turn in capital goods industries.”

“We expect the improvement to continue, but it will hardly be a robust upturn,” concludes Nesbitt.

On the downside, initial jobless claims unexpectedly rose to 417,000 last week, to a two-month high. “Last week’s east coast blizzard did not appear to be reflected in the data according to the Labor Department, making the latest read on claims subject to more pronounced future revisions,” says RBC. “Nevertheless, claims numbers have deteriorated in early 2003 and suggest that the U.S. labour market remains in the doldrums.”