Initial Jobless Claims
Initial Jobless Claims for the week ending February 11 (as reported on February 16):
• Jobless benefits fell 13,000 to 348,000, beating consensus estimates for a rise to 365,000.
• Jobless benefits are at their lowest level since March 2008 (Figure 1.1).
• Last week's figure was revised higher, from 358,000 to 361,000.
• 4-week moving average is 365,300 – down from last week's 367,000.
• 4-week moving average is at its lowest level since April 2008 (Figure 1.2).
• Continuing claims fell 100,000 to 3.43 million, the lowest level since August 2008.
• Unemployment rate among those eligible for benefits fell to 2.7% from 2.8% last week.
COMMENTARY: This morning’s report extends the streak of positive economic data points. An improvement in domestic manufacturing and labor conditions has supported equity prices year to date. In fact, this morning’s report is much needed in the wake of yesterday’s technical reversal that suggests a possible near-term top for the S&P 500® Index (SPX). Maintaining the SPX above the previous resistance level of 1333.47 on a closing basis, annotated below in Figure 1.3, will be critical to keeping the index favorably positioned for an attempt at last year’s 1370.58. A close below 1333.47 could lead to further corrective activity toward 1300.
Figure 1.1 Initial Jobless Claims, November 2007 to Present
Figure 1.2 Initial Jobless Claims 4-Week Moving Average, November 2007 to Present
Figure 1.3 S&P 500 Index (SPX), October 31, 2011 to Present