Thursday, January 3, 2013

Jobless Claims 1-3-13


TRADEX GLOBAL INTERNAL COMMENTARY

Jobless claims rose to 372k, higher than forecasted by economists who were estimating 360k claims.  The underlying claims trend is still fairly low, and at this time of the year weekly numbers can be volatile.  The four week moving average on claims was slightly higher at 360k from 359k, and that is what we focus on.  An ADP report showed that companies added more workers in December than forecasted.  We see layoffs and firings slowing and believe that jobless claims are under control.  ADP reported a 215k increase in employment in December, the largest increase since February 2012.  I would like to see the 4-week moving average of new jobs steady at 200k soon and move to 250k by mid-year in order to be convinced that the money that has been printed is moving into the real economy and that employers are more confident.  This is still a good start to the new year and we will take it along with the markets.  Keep nimble and Happy New Year from Tradex – Michael Beattie

EXTERNAL RESEARCH COMMENTARY

More Americans than forecast filed claims for unemployment insurance payments last week, according to government figures that were estimated because some state agencies closed during the holidays. Applications for jobless benefits increased 10,000 to 372,000 in the week ended Dec. 29, the Labor Department reported today in Washington. Economists forecast 360,000 claims, according to the median estimate in a Bloomberg survey. A report from the ADP Research Institute showed companies added more workers than projected in December. “The underlying claims trend is still really low,” said Scott Brown, chief economist at Raymond James & Associates in St. Petersburg, Florida. “There’s a lot of volatility this time of year. Job destruction is really not a problem right now, it’s really hiring that’s the issue.” The four-week average of claims, a less volatile measure, was little changed, indicating employers held on to current staff at the end of 2012 even as Congress made little progress in budget talks. The deal passed by lawmakers this week averted tax increases on about 99 percent of households while failing to reach a bargain on spending and debt. The data today from the Roseland, New Jersey-based ADP Research Institute indicated the job market finished 2012 with momentum. The 215,000 increase in employment was the group’s largest since February and followed a revised 148,000 gain the prior month that was larger than initially reported.


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