New York
CNN
—
First-time claims for unemployment benefits fell last week, putting some of the worst recession fears on hiatus and fueling market optimism after Monday’s global rout.
Initial claims fell to 233,000 from the prior week’s upwardly revised 250,000, according to Department of Labor data released Thursday.
“Anything in that range tends to suggest a fairly healthy labor market,” wrote economist Joseph Brusuelas on X Thursday morning.
Economists had expected 240,000 initial claims for unemployment insurance for the week ending August 3.
Nancy Vanden Houten, senior US economist at Oxford Economics, said the latest claims data was a reflection of the dissipating impacts of auto plant shutdowns and Hurricane Beryl.
But the report wasn’t all good news for the job market.
Thursday’s report also showed that continuing claims, which are filed by people who have received jobless benefits for at least a week or more, increased to 1.88 million for the week ending July 27, the ninth-straight week at or above that level.
Weekly jobless claims data can be highly volatile and is frequently revised. It remains near pre-pandemic levels.
The latest snapshot of the US labor market comes as Wall Street attempts to bounce back from a market plunge triggered by a weaker-than-expected July jobs report that showed unemployment rose to 4.3% from 4.1% and the economy added just 114,000 jobs. Concern that the US economy is slowing down more quickly than expected fueled losses on all three major US indexes on Monday, with the Dow at one point down by more than 2.6%.
US stock futures rose Thursday after the jobs data was released, and after the opening bell the Dow was higher by more than 500 points. The S&P 500 and Nasdaq Composite both gained around 1.4%. Treasury yields also moved higher, with the 10-year Treasury edging up to 3.981% after tumbling earlier this week due to the dismal jobs report.
Chris Larkin, managing director of trading and investing at E-Trade, said Thursday’s jobless claims data “may ease some of the concerns raised by last week’s soft jobs report.”
However, as investors begin to shift their focus from the labor market to next Wednesday’s key Consumer Price Index inflation report, “it’s unclear how much this will move the sentiment needle,” Larkin said in a statement on Thursday.
