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Instant view: Jobless claims fall in latest week

NEW YORK (Reuters) - The number of U.S. workers filing new applications for unemployment insurance fell as expected last week and a measure of underlying labor market trends hit a 1-1/2 year low, a government report showed on Thursday.

KEY POINTS: * Initial claims for state unemployment benefits slipped 6,000 to a seasonally adjusted 439,000 in the week ended March 27, the Labor Department said. * Analysts polled by Reuters had expected claims to dip to 440,000 from a previously reported 442,000 the prior week, a number that was revised to 445,000 in Thursday’s report.

COMMENTS:

JOSEPH BRUSUELAS, PRESIDENT, BRUSUELAS ANALYTICS, STAMFORD, CONNECTICUT:

“This signals that the labor market is inching toward stabilization. We are going to see a positive print in a positive reading and the overall reading should be bolstered by strong hiring by the government.”

STEPHEN GALLAGHER, CHIEF U.S. ECONOMIST, SOCIETE GENERALE, NEW YORK:

“They are pretty much along the lines of expectations so they will have no impact on the forecast for tomorrow (for non-farm payrolls). We’re looking for +215,000 tomorrow -- of course the bulk of all that will be census workers. We’re looking for the unemployment rate to fall to 9.6 percent.”

DAN COOK, SENIOR MARKET ANALYST, IG MARKETS, CHICAGO:

“It was pretty much right in line, but still not a great number. It won’t impact trading because traders are going to defer to the ISM number that’s coming out later today. However, there was some concern after yesterday’s weak ADP report. If we had had a one-two punch of weaker-than-expected jobs numbers, that would’ve been bad for tomorrow’s number, especially with all the optimism for job growth.

“The jobless number doesn’t give a great clue into tomorrow. We’ve seen some not great numbers as of late, but there are a lot of factors that could impact payrolls, from census hiring to weather conditions. It looks like the consensus is pretty high, so there may be some disappointment. If we don’t add any jobs, it’ll be pretty tough. It would put a lot of weight on equities.”

TOM PORCELLI, SENIOR ECONOMIST, RBC CAPITAL MARKETS, NEW YORK:

“Claims continue to grind lower, all consistent with the idea that layoffs are abating. Continuing claims held up and importantly the extending benefit category rose again, indicative of the tough time folks who have been laid off are having finding work.

“This number is outside of the survey week, so there are no implications for tomorrow’s (non-farm payrolls) number based on this data.

“It hasn’t had any impact (on Treasuries) so far just looking at rates here, pretty much looking at where we were pre-number. The market is looking past this number. They’re focused on the payrolls number.”

MARKET REACTION: STOCKS: U.S. stock index futures hold gains after initial claims data. BONDS: U.S. Treasury debt prices little changed. DOLLAR: U.S. dollar holds gains versus yen.

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