WASHINGTON -- The U.S. Commerce Department said Tuesday wholesale inventories rose 0.5 percent in September. The government agency said wholesale inventories were a seasonally adjusted $319.3 billion in September after jumping a revised 1.1 percent in August, which was originally reported as rising 0.9 percent.

The report showed wholesale sales rose 0.6 percent to a seasonally adjusted $276.85 billion. That followed a revised 1 percent gain in August, first reported up 1.2 percent.

Wholesale sales and inventory data give investors a chance to look below the surface of the visible consumer economy. Activity at the wholesale level can be a precursor for consumer trends. In particular, by looking at the ratio of inventories to sales, investors can see how fast production will grow in coming months.

The inventory-to-sales ratio remained unchanged at 1.15 in September; it was 1.2 in September 2003. The ratio measures how many months it would take for a firm to exhaust its current inventory.

The report showed inventories of durable goods -- meant to last three or more years -- rose 1 percent in September. Machinery stocks went up 0.4 percent and metals rose 2.6 percent, offsetting a 0.6 percenmt decline in auto supplies.

Durable goods sales dipped 0.1 percent.

Inventories of nondurable goods fell by 0.3 percent as stocks of drugs went down 0.2 percent. Petroleum inventories declined 2.7 percent, the biggest drop since March's 3.1 percent decline.

Copyright 2004 by United Press International