Yahoo Finance U.S. Weekly Unemployment Claims Hit Lowest Level Since 1973
The financial markets were mixed on Thursday with several posting volatile two-sided trades as investors reacted to economic data and outside events.
In the U.S., investors had the opportunity to react to Weekly Unemployment Claims, the Philadelphia Fed Manufacturing Index and the Conference Board’s Leading Index.
According to the U.S. Department of Labor, in the week-ending October 14, the advance figure for seasonally adjusted initial claims was 222,000, a decrease of 22,000 from the previous week’s revised level. This is the lowest level for initial claims since March 31, 1973 when it was 222,000.
The previous week’s level was revised up by 1,000 from 243,000 to 244,000. The 4-week moving average was 248, 250, a decrease of 9,500 from the previous week’s revised average. The previous week’s average was revised up by 250 from 257, 500 to 257,750.
The number was better than the 240,000 forecast. Additionally, the Department of Labor also said that claims taking procedures continue to be severely disrupted in Puerto Rico and the Virgin Islands as a result of power outages and infrastructure damage caused by Hurricanes Irma and Maria.
The Philadelphia Fed Manufacturing Index came in at 27.9, beating the 21.9 forecast. The Conference Board’s Leading Index fell 0.2% versus a forecast of 0.1%.
U.S. Treasury Yields
U.S. Treasury yields fell on Thursday despite the better-than-expected economic data. Instead of reacting to the economic reports, yields fell following a report that President Donald Trump was leaning toward Jerome Powell as the next chair of the Federal Reserve. Earlier in the week, yields rose as speculators bet Trump would appoint a more hawkish Fed Chair.
On Thursday, Trump interviewed current Fed Chair Janet Yellen. Some say it’s her job if she wants to take it. This may be good for the economy and the markets because of the continuation factor. However, there are still some investors who believe Trump is leaning towards more hawkish candidates, Fed Governor Kevin Warsh and economist John Taylor.
Gold
Gold prices recovered on Thursday after hitting their lowest level in more than a week. The short-covering rally was strong enough to produce a potentially bullish technical pattern on the charts.
The early session weakness was fueled by firmer U.S. Treasury yields, however, the market made a dramatic turnaround after stocks plunged in Asia and Europe. This sent investors scrambling out of risky assets and into the safe haven gold market.
Nervousness over political turmoil in Spain may have also been responsible for the price recovery.
By the end of the session, gold was being supported by a weaker U.S. Dollar as investors responded to falling Treasury yields and speculation that Trump was going to appoint a less-hawkish Fed Chair.
U.S. West Texas Intermediate and international-benchmark Brent crude oil fell over 1 percent on Thursday as investors continued to book profits from the spike to the upside earlier in the week. Prices were also pressured by larger-than-expected product inventories in this week’s U.S. Energy Information Administration’s report. Ongoing tension in the Middle East boosted prices earlier in the week because of the threat of supply disruptions, however, Thursday’s price action indicates that those concerns may now be priced into the market.
This article was originally posted on FX Empire
