Jobless claims impress, stocks up, dollar down against EUR
Americans, who take a look around at their jobs, see fewer colleagues missing from their work stations.
Today’s report on unemployment benefits reveals that the number of Americans who are forced to apply for financial support from the government declined by 21,000, last week. This was the third straight weekly drop in claims. And it shows that even though many Americans still struggle to hang onto their jobs, the situation is improving.
What is impressive about today’s number is that it comes two weeks after a holiday, and holidays often bring with them fluctuations in claims.
Last week’s number was for the week containing Labor Day and this skewed the number in a positive direction. This will typically result in a surge the following week, but this was not the case today. That in its own right is a cause for celebration.
We must not neglect the fact, however, that more than half a million Americans must walk to government offices each week and receive unemployment aid. We need to see consistent numbers below the half million mark before we can start to talk about a turnaround on employment.
Nevertheless, today’s report was certainly positive and received a round of applause from investors on Wall Street. The S&P 500 future quickly gained 2 points on the news as the appetite for risk increased and investors turned more bullish. This was also evident in the FX market where the dollar is currently down 20 pips versus the Euro. Given this report we maintain our daily stance on the S&P500 which has a target of 1,070. Unemployment is going down, and stocks are going up.
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