NEW YORK The number of Americans filing new claims for jobless benefits surged last week to a 1 1/2-year high after superstorm Sandy left tens of thousands of people out of work.
Consumer prices rose in October as the cost of shelter surged by the most in over four years, while gasoline prices fell in a boost for consumer spending power.
A third report showed manufacturing in New York state fell in November for a fourth month, suggesting factory activity in the state continues to decline at a modest pace.
PETER JANKOVSKIS, CO-CHIEF INVESTMENT OFFICER AT OAKBROOK INVESTMENTS LLC IN LISLE, ILLINOIS:
"It looks like the jobless claims number is probably what triggered the drop in the (stock) futures. It's probably the storm. There was some discussion that the prior week that the storm was actually suppressing it, because people couldn't get in to file claims, so it's quite possible that we are just catching up to that. Power has now been restored and things are moving back towards normalcy."
"We probably won't have a really good read until we get another couple of weeks out. Then you have holiday hiring and all that sort of stuff going into it too - you never really get to a calm point. But as far as getting past and getting a true feel for the post-storm situation, probably another couple of weeks ought to do it."
TOM PORCELLI, CHIEF U.S. ECONOMIST, RBC CAPITAL MARKETS, NEW YORK:
"Obviously the jump in jobless claims was related to Sandy and we should brace for a few more weeks of volatility because of that. We can probably discount jobless claims for the next few weeks due to Sandy.
"The real standout is the Empire report and it was actually better than the headline would lead you to believe. That is because of the improved new orders index, which is forward looking and new orders for the first time broke even for the first time in four months. As a result the Empire report was a decent report.
"The bigger picture is that all of this data does not alter the conversation, which is the fiscal cliff. I think we will hit a portion of it, but the question is to what degree."
PETER CARDILLO, CHIEF MARKET ECONOMIST AT ROCKWELL GLOBAL CAPITAL, NEW YORK
"Obviously, this data is storm related and we are starting to see the impact of this storm in terms of economic activity. Nevertheless, the numbers are certainly not encouraging and this is obviously going to add to market uncertainty, in terms of economic outlook."
TOM DI GALOMA, MANAGING DIRECTOR, NAVIGATE ADVISORS LLC, STAMFORD, CONNECTICUT:
"In my view, jobless claims were totally distorted by hurricane Sandy, though my sense is that the jobs picture will be quite weaker going forward as companies shed workers going into the fiscal cliff showdown with Congress and the administration."
SCOTT BROWN, CHIEF ECONOMIST, RAYMOND JAMES, ST. PETERSBURG, FLORIDA:
Jobless claims: "It's big jump, but in hindsight, you have the hurricane effect. I wouldn't read too much into it. I don't think the jobs market has suddenly deteriorated. The underlying trend has been very low in terms of job destruction. The problem over the last few years has been job creation. The job creation machine might sputter a bit because of the fiscal cliff...But I am not too concerned about the jobs market."
CPI: "(Fed Vice Chair Janet) Yellen said recently 2 percent is not its (target) ceiling so they could tolerate higher inflation. This suggests they have room to do more QE."
DAVID SLOAN, ECONOMIST, 4CAST LTD, NEW YORK:
"(The jobless claims number) is really just a response to hurricane Sandy. I don't know if it tells us that much about the underlying economy, where it would have been without the hurricane. It does suggest the risk of quite a weak payrolls reading for November, but the weakness should be a temporary thing. It does suggest the hurricane is going to have a bigger short-term impact than expected.
"The core CPI was a little stronger than expected. It seems like shelter was the main area of upside surprise, although I wouldn't say that core CPI is worrying at all.
"Empire State was more resilient than expected. It showed new orders as positive, so that contradicts the suggestion from the jobless claims that the hurricane Sandy impact will be worse than generally expected."
RYAN SWEET, SENIOR ECONOMIST, MOODY'S ANALYTICS, WEST CHESTER, PENNSYLVANIA
JOBLESS CLAIMS: "Looking at past hurricanes, it's common for claims to spike a week and two after. The bulk of the increase could be blamed on Sandy because a lot of the government offices were shut. With power back, people were able to file their claims. It illuminates how much of an effect Sandy had on the regional economy. While the impact is temporary, it's still a noticeable impact."
"Stepping back from the storm distortions, the economy is growing at about 2 percent. We will likely see a step back in job growth this month because of Sandy. The economy is just muddling along."
CPI: "Inflation is very low on the list of the Fed's concerns. There is a tremendous amount of slack in the economy. It will not be an issue until late 2013, 2014.
(Americas Economics and Markets Desk; +1-646 223-6300)