Initial unemployment insurance claims seem to have leveled off recently, and the bulls are interpreting this as another sign of the "recovery".
"The jobless claims were a fairly positive number," said Phil Flynn, head financial analyst for Alaron Trading Corp. "It is not the type of number that will knock your socks off, but it was pretty much in range of what was expected."As the below chart shows, jobless claims in July and August have indeed come down off of particularly high figures in the spring. That being said, we've seen this fluctuation under Bush before, including a rather sustained period last summer below the magic number of 400,000.
. . . It marked the fourth consecutive week in which the moving average was below the key 400,000 mark viewed as a sign of an improving job market.
"It's encouraging that we've been at or below that psychologically important 400,000 jobless claims level for several weeks now," said Patrick Fearon, an economist for AG Edwards and Sons. "There's no question that there's been a modest improvement in the labor market recently."
The black line is the four month moving average. For a larger picture, click here.