LIVE MARKETS-Construction spending shrinks in January's chill

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CONSTRUCTION SPENDING SHRINKS IN JANUARY'S CHILL

Investors who were starving for a feast of economic data on Monday had to make do with a two-month-old morsel from the Commerce Department in the form of its construction spending report.

U.S. construction outlays USTCNS=ECI unexpectedly contracted by 0.3% in January, defying analyst expectations of a slight 0.1% uptick to extend December's upwardly revised 0.8% increase.

Much of the decline was likely attributable to harsh winter weather which held much of the country in its icy grip during the first few weeks of the year.

Drilling below the headline, private sector spending dipped 0.6% while publicly funded projects grew by 0.6%.

A 3.3% jump in outlays on highways and streets and a 1.1% rise in office construction helped limit the overall weakness.

The residential segment, which often provides much of the upside muscle to the total (not to mention doing double-duty as a housing market indicator), fell 0.8%. The drop marked a partial reversal of the prior month's 2.5% surge.

This data agrees with recent data showing drops in new home sales, building permits, homebuilder sentiment and other metrics.

(Stephen Culp)

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