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The monthly report on durable goods is one of the most volatile reports you can get. The reason is that it involves the big-ticket items that are deemed to be long-lived rather than just the regular consumer spending and retail sales reports. One might have expected the stock market to tank if you just looked at the headline report this morning and saw how deep in the red the figures were. There is a lot more to the story than the headline data.

This morning’s report from the Commerce Department showed a headline reading of -5.2% to a seasonally adjusted $216.98 billion for the month of January. Bloomberg had a consensus of -4.0% and Dow Jones had a headline expectation of -5.5%. Again, this is the most volatile of all major monthly spending measurements.

The transportation component was the major issue, as sales were down a whopping 19.8% in January after a gain of 9.9% in December. If you back out transportation, durables orders were up by 1.9% in January after a 1.0% gain in December. Civilian aircraft orders were down by 34.0%.

Defense capital goods orders also hit skid row in January, with a whopping 69.5% drop. That appears to be the biggest drop going all the way back to 2000. This sounds awful on the surface, but the public needs to know that December saw a huge spike as the military brass turned in big orders that were more than double normal ahead of the planned spending cuts.

As far as why there is a silver lining, there was a 6.3% gain from business investment, and that reaches far wider than just defense and aircraft. If businesses are investing again after the fiscal cliff woes came to pass, then that is much more important than transportation and defense orders.

As a reminder, Thursday will bring the first revision to the fourth quarter gross domestic product report. The preliminary headline GDP report was -0.1%, and that was the first negative going back to when the recovery started in 2009. Bloomberg and Dow Jones are both expecting the GDP figure to be revised higher to a gain of 0.5%.

If the figures are revised higher by too much, you can expect the conspiracy theorists to come out of the woodwork saying that the numbers were fudged. That being said, a revision of 0.6 points higher seems like a lot, even if some of the preliminary data indicated that GDP may have been undercounted in the fourth quarter of 2012.

After 45 minutes of trading, stocks are up, with the DJIA up 40 points at 13,940 and the S&P 500 is up 4.6 points at 1,501.