Jobless Claims Data Suggests May 2012 Monthly Unemployment Report Could Be On Par With April:
Initial jobless claims data fell marginally according to the government today and the slight decrease has investors worried that job trends are getting worse. Initial claims for unemployment benefits fell 1,000 to a seasonally adjusted 367,000 while the prior week’s jobless claims figure was revised upward from 365,000 to 368,000 the Labor Department said today.
The four-week moving average for new jobless claims, a less volatile measure of labor market trends dropped 5,250 to 379,000 but this didn’t encourage traders much as economic data continues to show the U.S. economy is sluggish. April’s monthly unemployment report of 115,000 jobs added continued the negative trend from the prior month when only 120,000 jobs were added and early optimism about the economy that started this year has waned.
We have changed our economic outlook on the U.S. economy to mixed. Several data points show the economy is trending negatively. Earlier today, Citi confirmed they saw weakness and encouraged central banks around the world to become more innovative in their approach to solving the global slowdown. We couldn’t agree more and based on the initial claims data coming in, there is a high probability May 2012 monthly unemployment figures could remain low around 150,000+- 25,000. This would be a strong negative for U.S. equities related to housing and financials medium-run without some action to stimulate investor sentiment as well as jobs growth – a new catalyst is needed.
Tory Capital U.S. Economic Outlook:
- Mixed Positive
- Mixed - Current Tory Capital Economic Outlook
- Mixed Negative