Amid rioting -- in Greece, that is, not Vancouver -- a tumbling euro and freaked-out stock markets, investors appear to be accepting the latest batch of U.S. economic data on Thursday morning as slightly uplifting: Initial jobless claims and housing starts both came in better than expected, though neither report banishes concerns of an economic slowdown.
Jobless claims for the period ended last week fell to 414,000 from a revised 430,000 in the previous week. Economists had been expected a reading closer to 420,000. The problem, of course, is that any reading above 400,000 is high, given the celebrations earlier this year when claims dipped below that level for the first time since the recession struck, fuelling hopes that the economic rebound was well on its way.
Since then, claims have generally been marching higher. Indeed, Thursday's reading marks the 10th straight week that claims have been above 400,000, according to Calculated Risk. The blogger also pointed out that the four-week moving average was unchanged, at 424,750 -- meaning that there has been no improvement since January.
On the housing front, new home starts rose 3.5 per cent to an annualized rate of 560,000. Economists had been expecting a reading of 548,000. So, again, this marks a slight improvement, although starts have been crawling along the basement for some time.
U.S. stock futures seem to be taking the reports well, paring their implied declines. Futures for the S&P 500 were off just 2 points or 0.2 per cent with less than an hour before markets open, after a bigger decline earlier in the morning.
David Berman