Weekly jobless claims have fallen below the 400,000 mark to 383,000 for the week ended February 5th — a dip of 36,000 and a big surprise from the 413,000 expected. It is also the lowest level since July 2008. The four-week moving average is down 15,000 to 431,500, and this figure averages in the exceptional volatility we’ve seen with these numbers lately.
This further pushes the narrative that we have broken out of the “trading range” around 450,000 jobless claims we had been in throughout all of 2010. Many analysts — including Zacks Chief Market Strategist Dirk van Dijk, CFA — had been looking at the 400,000 number as a watershed level, below which point a meaningful amount of Americans are again finding work and helping the economy recover in earnest.
Continuing claims posted a level of 3.925 million, which is down 941,000 year over year. The total number of Americans receiving unemployment benefits is 9.299 million, down 2.289 million year over year.
That said, the pre-markets did not jump on the news, and futures had been down previous to this new jobless report. Part of the reason may that the market has priced in some of this good news following last week’s unemployment rate falling to 9.0%, and also that there is real downward pressure on the markets following 8 straight up days on the Dow.
We anticipate a comprehensive breakdown of these numbers from Zacks Chief Market Strategist Dirk van Dijk, CFA a bit later today. But however you slice it, breaking through the psychological barrier of 400,000 new jobless claims must be considered a positive development, even if some of that has already been priced into the market.
Zacks Investment Research
