Big Surprise in Claims but…

Initial Jobless Claims totaled 391k, 30k below estimates and down from 428k last week. It’s the lowest level since April but the Labor Department said, according to DJ, the sharp fall was due to “technical issues and seasonal adjustment volatility, rather than economic factors.” Since there weren’t any holidays over the past few weeks I’m not sure what issues the Labor Dept could have had but I guess we’ll have to wait until next week to get a better feel. Continuing Claims were in line but Extended Benefits rose a net 75k. Bottom line, while the market responded well to the Initial Claims print, the Labor Dept caveat shouldn’t be ignored. Unfortunately though we’ll have to wait until next Thursday to see whether a new positive trend is being established or today was a technical anomaly.

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