NEW orders for factory goods in the US rose for a second straight month in May, adding to tentative signs of stabilization in manufacturing after a recent slowdown.

The Commerce Department yesterday said new orders for manufactured goods rose 2.1 percent. April's orders were revised to show a 1.3 percent rise instead of the previously reported 1 percent advance.

Economists polled by Reuters had forecast new orders received by factories rising 2 percent.

Manufacturing slowed in recent months, weighed down by deep government spending cuts and slowing global demand, especially in China and recession-hit Europe.

But there are signs the loss of momentum has run its course or is starting to ebb.

Data on Monday showed a gauge of national factory activity bounced back into growth territory in June, with new orders pushing higher. That improving tone was also evident in reports last month showing a modest rise in factory output in May and a pick-up in business spending plans.

The department report showed factory orders rose in most categories, though orders for motor vehicles fell 2 percent. However, new transport orders jumped 10.9 percent.

Orders excluding the volatile transport category rose 0.6 percent after edging up 0.2 in April.

Outside transport there were gains in orders for machinery, computer and electronic products and primary metals. Orders for electrical equipment, and appliances and components orders also rose.

The department also said orders for durable goods, manufactured products expected to last three years or more, rose 3.7 percent instead of the 3.6 percent gain reported last week.

Durable goods orders excluding transport rose 0.5 percent rather than 0.7 percent.

Orders for non-defense capital goods excluding aircraft ? seen as a measure of business confidence and spending plans ? rose 1.5 percent instead of the previously reported 1.1 percent rise.

Adding to the improving manufacturing picture, unfilled orders for factory goods rose 0.8 percent in May. Unfilled capital goods orders excluding defense and aircraft were up 1 percent.