Yesterday the stock market was all upset because Ben Bernanke indicated the gush of fed money might slow a tad. The market went down 107 points.
Today we got word that the weekly jobless claims went up by 10,000. Even though that is not terrible, we have been stuck in that trough for a long time, stagnating. The GDP had dropped a little, too.
Zerohedge puts it all in perspective:
Just when there was some concern that the US economy was no longer imploding at the usual pace, we get confirmation that nothing is actually better, following the one-two punch of weaker than expected Q1 revised GDP data, printing at 2.4% on expectations of an unchanged 2.5% print driven by a revision in Private Inventories (from 1.03% to 0.63% of total GDP, offset by a plunge in imports sliding from -0.9% to -0.32%, Personal Consumption posted a tiny increase from 2.24% to 2.40% which can only mean the consumer overextended themselves in Q1), as well as Initial Claims increasing from the naturally upward-revised 344K to 354K, on expectations of a 340K print. But fear not: what both these data points showed is that any fears that the monthly Fed flow may slow down from the $85 billion monthly to a ghastly $75 billion or, heaven forbid, a tiny $65 billion monthly increase in the Fed’s balance sheet, may be deferred. End result: futures jump higher. Because it is a Bizarro Ben, or Benzarro for short, market after all.
As for claims, the holiday-shortened week prompted the Labor department to ‘estimate’ claims from 5 states (Virginia, Wyoming, Hawaii, Minnesota, and Oregon). The 354k print is a miss from expectations of 340k for the worst combined 3 weeks in over 2 months. The gentle downtrend of claims appears (though noisy) to be finding a limit here as the 4-week-average ticked up yet again. The total number collecting benefits rose by 63,000 to 2.99 million. California topped the initial claims list.