By Geoffrey Smith
Investing.com -- The number of people making initial claims for jobless benefits stayed roughly unchanged at the historically high level of 787,000 last week, according to figures released on Thursday by the Labor Department.
That's fractionally below the 800,000 expected by analysts ahead of time and down by 3,000 from the previous week's figure, which was revised up a shade.
The number of continuing claims fell by more than expected to 5.072 million from 5.198 million, the latter figure being revised down by 21,000 from its initial estimate.
The numbers appear to indicate no meaningful improvement in the labor market since the cut-off date for December's nationwide payrolls surveys. ADP's monthly survey for December, which covered the period up to the middle of last month, showed that private payrolls fell by 123,000 in a month when the service sector in particular was hit by a fresh surge in Covid-19 cases nationwide.
"The underlying story here is clear," said Ian Shepherdson, chief economist at Pantheon Macroeconomics. "A combination of Covid fear and state-mandated restrictions on activity in the services sector is squeezing businesses, and no real relief is likely until a sustained decline in pressure on hospitals emerges; that’s probably a story for late February at the earliest."
He noted that while the figures reflect real hardship, there was comfort in the fact that they had not developed more serious upward momentum.
The impact of the numbers on financial markets was minimal Thursday, overshadowed by the prospect of more aggressive stimulus from the incoming administration of Joe Biden, which will be able to count on majorities in both houses of Congress. By 9 AM, Dow Jones Futures were up 128 points, or 0.4%, while NASDAQ Futures were up 0.9%.
Yields on 10-YearTreasury bonds, however, resumed their rise, hitting 1.07% after crashing through 1% for the first time in 10 months on the back of Georgia's Senate seat runoffs on Wednesday.