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NEW YORK (Reuters) - Corporate America spent part of its record $1.65 trillion (1.02 trillion pound) cash stockpile to buy companies and their own stocks in the past three months as their confidence in the U.S. economy grew, a survey showed.
This marks the first year-over-year decline in U.S. companies' cash reserves since the Association for Financial Professionals began conducting the survey in 2011.
The industry group's year-over-year corporate cash index came in at minus 4 points in the three months ending in October, compared with plus 27 points in the prior quarter ending in July.
"It's a good sign that companies are willing spend some of that cash. They feel a bit more confident about the economy," Jim Kaitz, president of AFP, which is based in Bethesda, Maryland said of its survey released late Monday.
Some AFP members plan to spend more cash on capital investments, he added.
Corporate America's cash stockpile grew to a record $1.65 trillion in mid-2014, Moody's Investors Service said last week.
Spending the cash on mergers and acquisitions and stock buybacks has driven U.S. stocks to record highs, analysts said, but has not led bigger paychecks for workers, which is something that has worried the U.S. Federal Reserve.
Thomson Reuters data also show a pickup in M&A spending and the number of share buybacks.
The third quarter had 2,326 M&A deals worth $429.68 billion, compared with 2,451 deals worth $321.95 billon in the year-ago quarter.
There were 157 announced share repurchases in the third quarter, up from 108 in the same 2013 quarter, but the value of the repurchases dropped to $56.74 billion from 122.45 billion.
U.S. data on durable goods orders released on Tuesday, however, suggested not much of cash has gone to buying plants and equipment. Orders for big-ticket items unexpectedly fell 1.3 percent in September following a revised 18.3 percent drop in August.
(Reporting by Richard Leong; Editing by Richard Chang)