TRADEX GLOBAL INTERNAL COMMENTARY
Jobless claims decreased by 2k last week to 387k, with the
prior week being revised up by 3k. The number was worse than consensus
expectations (383k), pushing the 4 week average up to its highest level of the
year. Continuing claims were unchanged, but still higher than expected.
Joblessness continues to be a problem, with recovery coming much slower than is
needed. Prior week revisions also continue
to be poor, with the jobless claims trend creeping back up towards 400k. Tail hedges are on both portfolios as we wait
for some better news to come out. – Richard Travia
EXTERNAL RESEARCH COMMENTARY
More Americans than forecast filed applications for unemployment
benefits last week, indicating the labor market continues to struggle. Jobless
claims decreased by 2,000 to 387,000 in the week ended June 16, Labor
Department figures showed today in Washington. The median forecast of 45
economists surveyed by Bloomberg News called for 383,000. The four-week
average, a less volatile measure, climbed to the highest of the year. The level
of dismissals may raise concern the slowdown in payrolls reported in the past
few months will be prolonged, limiting consumer spending. Federal Reserve
policy makers yesterday expanded a program to replace short-term bonds with
longer-term debt in a bid to spur growth and trim a jobless rate that’s
exceeded 8 percent for 40 consecutive months. “Momentum is slowing,” said Ryan
Wang, an economist at HSBC Securities USA Inc. in New York, the only economist
in the Bloomberg survey to correctly forecast the level of claims. “Companies
have curtailed demand for labor. This means less income growth. That’s a
restraint on consumer spending.” Stock-index futures were little changed after the
report. The contract on the Standard & Poor’s 500 Index maturing in
September rose 0.1 percent to 1,351.8 at 8:41 a.m. in New York. Estimates in
the Bloomberg survey ranged from 371,000 to 390,000. The Labor Department
revised the previous week’s figure up to 389,000 from an initially reported
386,000.
Tradex Global Advisory Services, LLC
investorrelations@thetradexgroup.com
203-863-1500
@Tradex_Global
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