First time jobless claims fell by 6k to 361k, beating
consensus expectations of 370k. Last week’s payrolls grew more than forecast
and there were less firings. The Labor Department said that there were no
extraordinary factors behind the surprise. Of course, to remain painfully
consistent, last week’s claims were revised higher by 2k. Perhaps the trend is
stepping down from May & June’s 380k claims, which would be welcomed, but
this is quite often a volatile number. The market is flat right now after an
early rally petered out. – Richard Travia
EXTERNAL RESEARCH COMMENTARY
Fewer Americans filed applications for unemployment benefits
last week, a sign the labor market may keep improving after employment picked
up in July. Jobless claims unexpectedly dropped by 6,000 to 361,000 in the week
ended Aug. 4, Labor Department figures showed today in Washington. The median
forecast of 43 economists surveyed by Bloomberg News called for an increase to
370,000. A spokesman for the agency said there was nothing unusual in the data.
Fewer firings mean employers are seeing enough demand to retain staff,
indicating the world’s largest economy is sustaining the recovery from the
recession. Labor Department data last week showed payrolls rose more than
forecast in July. “Today’s report is a mild positive for the labor market,” Joseph
LaVorgna, chief U.S. economist at Deutsche Bank Securities Inc. in New York,
said in an e-mail to clients. “Assuming we do not see a large uptick in claims
over the next two weeks, we would expect August payroll growth to at least
match that of July, if not exceed it.” Stocks rose for a fifth day, giving the
Standard & Poor’s 500 Index its longest rally since March. The S&P 500
climbed 0.2 percent to 1,404.56 at 11:21 a.m. in New York. Estimates in the
Bloomberg survey ranged from 359,000 to 385,000. The Labor Department revised
the previous week’s figure up to 367,000 from an initially reported 365,000. A
Labor Department spokesman said last week that today’s data should be clear of
any influence from the annual auto plant retooling closures that make it
difficult to adjust the data for seasonal variations.
Tradex Global Advisory Services, LLC
investorrelations@thetradexgroup.com
203-863-1500
@Tradex_Global
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