Jobless Claims Fall to 473,000

The stock market is getting a nice snap-back rally today after yesterday’s drop. I usually don’t pay much attention to the wholesale inflation report, but that came out today and it was also on the hot side. The PPI was up 0.6% last month which doubled expectations. In the last year, the PPI is up 6.2%. That’s the highest since they started tracking the data in 2010.

Core PPI was also high:

The core PPI, which excludes volatile items like foods, energy and trade services, rose 0.7% in April from the previous month and jumped 4.6% year over year. The increase from a year ago was the biggest jump since 2014 when the department first calculated the data.

This morning’s jobless claims report came in at 473,000. That was another pandemic low and it was below Wall Street’s forecast of 490,000.

Generous unemployment benefits, fears of catching Covid-19, parents staying home to care for children and raw material shortages as well as pandemic-related retirements and career changes have been blamed for the disconnect. The economy created 266,000 jobs in April after adding 770,000 in March, the government reported last week.

Some economists believe the enhanced unemployment benefits programs, including a weekly $300 government subsidy, could be encouraging some people to attempt to file a claim for assistance, keeping claims well above the 200,000 to 250,000 range that is viewed as consistent with a healthy labor market.

It’s a strong market today but I’m suspicious. Everything that had been doing well is doing poorly and the ones that had been poor are now leading the charge. Energy, in particular, is down today.

Posted by on May 13th, 2021 at 12:13 pm


The information in this blog post represents my own opinions and does not contain a recommendation for any particular security or investment. I or my affiliates may hold positions or other interests in securities mentioned in the Blog, please see my Disclaimer page for my full disclaimer.