World Bulletin / News Desk
The number of Americans filing new claims for jobless benefits roseless than expected last week, but the data continues to be influenced by distortions from seasonal auto shutdowns.
Initial claims for state unemployment benefits rose 8,000 to a seasonally adjusted 365,000, the Labor Department said on Thursday. The prior week's figure was revised up to 357,000 from the previously reported 353,000.
"The claims number is not that bad. There does seem to be some difficulty dealing with the seasonals this time of year whether it's auto plant closures or lack thereof," said Cary Leahey, a senior economist at Decision Economics in New York.
Economists polled by Reuters had forecast claims rising to 370,000 last week. The four-week moving average for new claims, a better measure of labor market trends, fell 2,750 to 365,500, the lowest in four months.
Temporary plant shutdowns by automakers for annual retooling cause wide swings in claims data in July, which makes it difficult to get a clear picture of the labor market's health.
The model used by the government to smooth the numbers for typical seasonal patterns has trouble anticipating the timing of the temporary closures and in addition, some automakers kept production lines running in July.
A Labor Department official said last week was the last where the seasonal expectation was shaped by seasonal layoffs in the auto manufacturing sector.
U.S. financial markets were little moved by the data, with traders focusing attention on a press conference by European Central Bank President Mario Draghi.
The claims data has no bearing on the July employment report as it falls outside the survey period.
The government is expected to report on Friday that employers added 100,000 new workers to their payrolls last month, according to a Reuters survey, up from 80,000 in June.
Job growth averaged 75,000 per month in the second quarter, a sharp deceleration from the average monthly increase of 226,000 in the first three months of the year.
An uncertain fiscal policy path and ongoing debt problems in Europe have hurt demand and left businesses cautious about hiring new workers.
On Wednesday, the Federal Reserve signaled it was willing to ease monetary policy further, noting that economic activity had slowed in the first half of the year. Many economists expect the U.S. central bank to launch a third round of bond buying, also known as quantitative easing, in September.
The number of people still receiving benefits under regular state programs after an initial week of aid fell 19,000 to 3.3 million in the week ended July 21.
A second report showed planned layoffs at U.S. companies dropped for a second straight month in July, even as job cuts in the financial sector persisted.
Employers announced 36,855 planned job cuts last month, down 1.9 percent from June, consultants Challenger, Gray & Christmas said. So far this year, announced layoffs are up 2.5 percent from the same period in 2011.
The financial sector cut 6,156 jobs in July, the largest number since January.
"The situation in Europe is far from being resolved and ongoing weakness here could continue to take a toll on the financial sector," John Challenger, chief executive of the company, said in a statement.
Challenger also cautioned that layoffs typically slow during the summer months, while the heaviest job cuts historically happen in the fourth quarter.
"This may simply be the lull before the storm," he said.
Volatility eased as traders focused on the world economy and corporate earnings after a week dominated by the dramatic spike in tensions over North Korea, which triggered a global sell-off before prices bounced back Monday.
Investors greeted the more conciliatory tone after US stocks dropped three days in a row last week on President Donald Trump's vow of "fire and fury" if North Korea continued to pursue its nuclear weapons and ballistic missile programs.
The ultra-conservative kingdom has moved to diversify its traditionally oil-dependent economy following a sharp fall in crude prices.
In its monthly report on the global oil market, the International Energy Agency said, however, that it believes the supply glut is easing, partly because demand is growing faster.
US stocks have been in retreat since President Donald Trump Tuesday issued a fiery warning to North Korea to halt its nuclear program.
The move by one of Japan's best-known firms greatly reduces the chance of an embarrassing delisting from the Tokyo Stock Exchange (TSE).
London's benchmark FTSE 100 index weakened by 0.5 percent to 7,503.39 points.
The approval by the European Commission comes just over two months after the European Central Bank -- which took on the role of the eurozone's banking supervisor in 2014 -- allowed the sale to go ahead for a symbolic fee of one euro.
BP, Chevron, ExxonMobil, Shell and Total have all published results in recent days, showing they pocketed $23 billion in net profit in the first half fo the year.
Higher cereal, sugar and dairy prices pushed food price index by 10.2 percent annually in July
HSBC was also a big riser, gaining three percent at £7.65 ($10, 8.5 euros) in late morning trade after the British banking giant announced a share buyback plan alongside a rise in first-half profits.
Both main crude contracts made strong gains, with WTI testing $50 a barrel for the first time since late May and Brent heading towards $53, while mining giants BHP Billiton and Rio Tinto saw their share price rise as commodities strengthened.