Instant View: Weekly jobless claims little changed

NEW YORK (BestGrowthStock) – New U.S. claims for unemployment benefits rose slightly last week as expected, but the underlying trend remained tilted toward a gradual improvement in the labor market.

Initial claims for state unemployment benefits climbed 2,000 to a seasonally adjusted 439,000, the Labor Department said. Economists polled by Reuters had forecast claims rising to 440,000 from the previously reported 435,000. The government revised the prior week’s figure up to 437,000.

The four-week average of new jobless claims, considered a better measure of underlying labor market trends, dropped 4,000 to 443,000, the lowest level since the week ending September 6, 2008.

The number of people still receiving benefits after an initial week of aid fell 48,000 to 4.30 million in the week ended November 6, in line with expectations and the lowest since November 2008. The prior week’s figure was revised up to 4.34 million.

The number of people on emergency unemployment benefits rose 66,767 to 3.97 million in the week ended October 30. A total of 8.85 million people were claiming unemployment benefits during that period under all programs.

The data covered the survey week for the government’s employment report for November, but weekly claims have been too volatile to provide a good prediction of nonfarm payrolls.

ANALYSTS COMMENTS:

CARY LEAHEY, ECONOMIST, DECISION ECONOMICS, NEW YORK:

“You continue to get a downward move in the smooth forward moving average. You had a stable number in the most current week, the forward moving average is down 16,000 in the payroll employment survey week for November, compared to October, so you are basically looking at the same kind of tone to the labor market in November to October.”

“October was reasonably good, so I think most analysts will look at this report and think you are going to get another triple digit gain in payrolls, maybe some offsets because of the very weak municipal sector, but we will see an okay kind of November jobs report.”

“The difficulty you have with QE2 at the moment, is that the Fed can certainly find justification in yesterday’s unchanged core inflation readings that deflation is still a serious bugaboo and they want to push up inflation rate to 2 percent over time.”

“You can look at today’s data positively for bonds as the improvement has leveled off at around 440,000, or you could look at the opposite approach that the trend is still quite favorable moving into December, so I don’t think you can trade it strongly one way or another.”

NICK KALIVAS, ANALYST AT MF GLOBAL IN CHICAGO:

“It’s showing some hope that there is a recovery in labor demand. It is on the lower side from what we’ve been seeing and maybe that is generating some optimism that we will see another positive payrolls number.”

FRED DICKSON, CHIEF MARKET STRATEGIST, THE DAVIDSON COS. IN LAKE OSWEGO, OREGON:

“I look at it and say the trend is down, and this basically suggests we probably should be looking at another decent employment report in December. I think that would be looked at in a favorable light.

The jobless news today is going to be secondary (to GM and Ireland) in terms of market-moving, but the trend is encouraging.”

JOHN CANALLY, INVESTMENT STRATEGIST, LPL FINANCIAL, BOSTON:

“Based on the four-week moving average, monthly job creation is above at 130,000 maybe even 140,000. Double-dip recession risk is fading. It’s a step in the right direction, but it’s not enough for the Fed to give up on quantitative easing.”

TOM PORCELLI, U.S. ECONOMIST, RBC CAPITAL MARKETS, NEW YORK:

“I think it’s hard to make much of any one week’s movement but I think why this number might matter a little more is that this number actually captures the survey week of the payrolls report.

“On the face of it, this would mean a pretty decent payrolls number.”

Instant View: Weekly jobless claims little changed