Last week the number of first-time jobless claims dropped by 11,000 putting the total at 457,000. Although this may be a good sign, the number of people still receiving unemployment benefits rose, which many expects claim is slowing the pace of economic growth.
“The underlying pace of claims has not made any measurable improvement,” said Ellen Zentner, senior U.S. macro economist at Bank of Tokyo-Mitsubishi UFJ Ltd. in New York. “Businesses are investing in equipment but other than that there’s little impetus” for them to hire, she said.
Economists forecast claims would fall to 460,000, from a previously reported 464,000 for the prior week, according to the median of 42 projections in a Bloomberg survey. Estimates ranged from 445,000 to 500,000.
Stocks rose as companies from Exxon Mobil Corp. to Goodyear Tire & Rubber Co. posted better-than-estimated earnings. The Standard & Poor’s 500 Index rose 0.2 percent to 1,108.67 at 10:28 a.m. in New York. The yield on the 10-year Treasury note rose to 3 percent from 2.99 percent late yesterday.
The four-week moving average of claims, a less-volatile measure, dropped to 452,500 last week, the lowest since May 8, from 457,000, today’s report showed.