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Jobless claims remained at a four-year low for the third straight week, supporting other indicators of a strengthening economic recovery.
Some 351,000 Americans filed for unemployment benefits last week. The level remains basically unchanged from a week earlier—when claims were 353,000, according to revised Labor Department figures. Jobless claims hovered near April 2008 levels through February.
“Overall, the report was again positive, and along with other labor market data, the broader improvement in the labor market is becoming more convincing,” says Barclays Capital Troy Davig.
The strong jobless claims data prompted futures to advance Thursday, and markets are posed to open in the green. The Dow Jones Industrial Average would gain around 32 points and open at 12,938.07. The Nasdaq composite would increase near 11 points to 2623.15. The S&P 500 index is poised to increase three points to 12938.07.
Retailers were among the biggest pre-market movers: Target and Gapreported stronger-than-expected same store sales.Wal-Mart announced an improving North American market would allow it to raise its dividend 9%.
On the Nasdaq, take-over discussions have boosted Vivus shares by 2%. And news that Sprint may find funding for its partner Clearwire sent its share up about 2% too.
In other economic news, personal income grew 0.3% last month, lower than expected. Economists had raised forecasts after an unexpected 0.5% surge in December. Wages and salaries expanded 0.4%, matching December’s growth.
Consumer spending expanded 0.2% after no gain in December, but was still lower than the expected 0.4% forecast. With consumer spending accounting for some 70% of all economic activity, experts pay special attention this indicator to gauge broader economic health.
Why were Americans spending less than expected? Well, they didn’t need to heat their home as much, thanks to the warm winter, says Barclays Capital economist Peter Newland. Real spending on household electricity and gas fell by $10.3 billion in January, reducing overall consumer...