UPDATE: Goldman Sachs Cuts US GDP Estimate By Brendan Conway Of DOW JONES NEWSWIRES
NEW YORK (Dow Jones)--Ahead of Thursday's U.S. gross domestic product numbers, Goldman Sachs cut its third-quarter GDP estimate to 2.7%, following lower-than-expected durable-goods shipments Wednesday morning. The estimate, calculated on an annual basis, is down from the 3% Goldman previously expected. The latest adjustment comes about three months after Goldman seemed more optimistic in boosting its second-half growth estimate, which is also annualized, to 3% from 1%. Despite the reduced estimate for GDP growth, Goldman noted that orders for long-lasting goods were less dependent on volatile components than some, including Goldman, had expected. The firm called the durable-good numbers "actually quite encouraging," because the gains were "not heavily concentrated in the volatile defense and transportation categories." However, shipments were "somewhat weaker, especially for nondefense capital goods," Goldman said in the Wednesday report. Back in August, Goldman cited a stronger-than-expected second-quarter GDP report as it hiked its figure, and also said that federal stimulus efforts were a bigger assist than expected. News of the GDP estimate reduction from Goldman was reported earlier on CNBC. The Dow Jones Industrial Average was down 47.84 recently to 9,834.33. -By Brendan Conway, Dow Jones Newswires; (212) 416-2670; brendan.con...@dowjones.com http://online.wsj.com/article/BT-CO-20091028-713966.html
