Thursday, February 07, 2008

Initial Jobless Claims Fall, Pending Home Sales Decline

- Initial Jobless Claims for this week fell to 356K versus estimates of 342K and 378K the prior week.

- Continuing Claims rose to 2785K versus estimates of 2715K and 2710K prior.

- Pending Home Sales for December fell 1.5% versus estimates of a 1.0% decline and a downwardly revised 3.0% decline in November.

BOTTOM LINE: The number of Americans filing first-time claims for unemployment benefits fell this week, Bloomberg reported. The four-week moving average of jobless claims rose to 335,000 versus 326,500 the prior week. The unemployment rate among those eligible for benefits, which tracks the US Jobless claims are still at levels suggesting sluggish growth, not recession. I expect claims to move back down to more healthy levels in the second half of the year. unemployment rate, rose to 2.1%, which is still historically low, versus 2.0% the prior week.

The number of Americans signing contracts to buy previously owned homes fell more than forecast in December, Bloomberg reported. Purchases fell 3.1% in the West, 3% in the South and 1.7% in the Northeast. They jumped 3.4% in the Midwest. I still expect home sales to surprise on the upside as we entire the spring on pent-up demand, lower prices and the plunge in mortgage rates.

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