1st LD Writethru: Japan's core machinery orders up 1.3 pct in November

Japan's core machinery orders in November last year rose a smaller-than expected 1.3 percent from the previous month to 788.0 billion yen (6.72 billion U.S. dollars) , government data showed Thursday.

The orders, widely regarded as a leading indicator of capital spending, rose following a seasonally adjusted 6.4 percent fall in October and a 2.9 percent gain in September, the Cabinet Office said, suggesting companies are still cautious about capital expenditure due to worries about domestic demand.

It also downgraded the basis assessment of the core machinery orders for the first time in five month, stating they are at a " standstill in their pickup trend." It noted last month that they " have shown signs of a gradual pickup."

If business investment remains weak, more economists could start to question Japanese Prime Minister Shinzo Abe's argument that his policies are leading to a revival of Japan's hollowed-out manufacturing sector.

In the reporting period, orders from the manufacturing sector fell 7.0 percent to 319.8 billion yen, while those from non- manufacturers were up 0.5 percent to 444.9 billion yen.

Total orders, including those from the domestic public sector and abroad, decreased 10.4 percent to 2,022.2 billion yen.

Overseas demand for Japanese machinery, an indicator of future exports, declined for the third straight month, down 6.0 percent to 856.2 billion yen. Endi