Initial jobless claims came in much better than expected though the labor department is warning that seasonal trends played a large role in the improvement. Econoday reports:
Substantial improvement, but improvement tied to seasonal adjustments, is underway in jobless claims where initial claims fell 47,000 to a lower-than-expected 522,000 in the July 11 week (prior week revised to 569,000). The four-week average is down 22,500 to 584,500. Continuing claims really fell, down 642,000 to 6.273 million. But the Labor Department is warning that results for both initial and continuing claims are being affected by prior layoffs in the manufacturing sector, layoffs that are largely seasonal and that happened earlier than usual this year. Stocks and commodities popped higher, but only briefly, in initial reaction to the headline decreases.
The Philly Fed survey came in worse than expected at -7.5. Improvement in manufacturing is proving to be a very slow process.