Jobless Claims by the Numbers, Not so "Unexpected"
U.S. Initial Jobless Claims Rose by 15,000 to 576,000 (Bloomberg):
More Americans unexpectedly filed claims for jobless benefits last week, indicating companies are trying to cut costs further even as the economy stabilizes.
Applications rose to 576,000 in the week ended Aug. 15 from a revised 561,000 the week before, the Labor Department said today in Washington. The number of people collecting unemployment benefits the week earlier was little changed at 6.24 million.
Companies may keep paring staff in coming months, albeit at a slower pace, and hiring linked to the government’s recovery effort may not gain speed until 2010. While the unemployment rate dipped last month, economists project it will reach 10 percent by early next year, restraining consumer spending.
“The improvement in the labor market has stalled,” said Derek Holt, an economist at Scotia Capital Inc. in Toronto, who had forecast claims would rise to 570,000, “Consumer spending will be pushed back on its heels for a longer time than markets are expecting.”
Stock-index futures trimmed earlier gains after the report showed the recent reduction in firings wasn’t being sustained. The contract on the Standard & Poor’s 500 index was little changed at 996.8 at 8:41 a.m. in New York, after being up as much as 0.7 percent earlier.
Oh, what happened? I thought things were looking better?! Bwhahahahahaha mmkay. Bonus points to Bloomberg for saying this was "unexpected," as if we had absolutely no idea things were this bad. That's awfully cute.