First time unemployment claims came in at 403,000 today which was 3,000 more than expected yet another week over the dreaded 400,000 mark.
The strengthening of the dollar to the euro is not getting the recognition it deserves. However it is keeping oil prices in check recently.
Here are the top financial stories of the day:
1) Stocks end mixed as Europe haggles over debt fix-From the AP
Stocks are closing mixed after reports that European leaders remain split over how to fend off a larger financial crisis in the region.
The Dow Jones industrial average rose 37 points, or 0.3 percent, to close at 11,542 Thursday. The S&P 500 index rose 6, or 0.5 percent, to 1,215.
The Nasdaq slipped 5, or 0.2 percent, to 2,599.
European officials are scheduled to meet this weekend to discuss ways to contain the continent's debt troubles. On Thursday, Germany and France called for a second emergency summit next week after it became clear that they would not be able to bridge their differences before the weekend.
More than three stocks rose for every two that fell on the New York Stock Exchange. Trading volume was average at 4.2 billion.
2) Jobless Claims Essentially Unchanged-From The Wall Street Journal
New claims for unemployment benefits moved down slightly last week but remained elevated, indicating the labor market still is weak.
Initial jobless claims fell by 6,000 to a seasonally adjusted 403,000 the week ended Oct. 15, the Labor
Department said Thursday. Claims filed in the previous week increased by 4,000 to an upwardly revised 409,000.
The number of new claims last week remained above the 400,000 mark -- a level under which economists generally believe the jobs market is really starting to improve.
The four-week moving average of new claims, a more reliable indicator of the labor market's performance because it smooths out volatile weekly figures, fell by 6,250 to 403,000 last week.
Economists surveyed by Dow Jones Newswires had forecast claims would fall by 4,000 to 400,000.
A Labor Department official said there was nothing unusual about the latest state level data.
The relatively stagnant new jobless claims figures suggest that companies are reluctant to add to payrolls in a still shaky economy but at the same time are resistant to big layoffs, economists have said recently.
Thursday's report showed the number of continuing unemployment benefit claims -- those drawn by workers for more than a week -- totaled 3,719,000 in the week ended Oct. 8. Continuing claims are reported with a one-week lag. That number was up 25,000 from the prior week.
Though U.S. employers did add jobs in September, the labor market is growing too slowly to bring down the unemployment rate, which was stuck at 9.1% last month.
President Barack Obama took to the road this week in North Carolina and Virginia to garner support for his $447 billion jobs bill that has met resistance in Congress. Republicans in the Senate blocked the plan as a whole and now Democrats are vowing to move it forward in pieces. The battle highlights the difficulty facing the Obama administration in bringing down the jobless rate.
That leaves Federal Reserve officials to debate options for boosting the economy -- including another round of bond purchases -- if the recovery falters. Fed officials project unemployment to remain elevated at least through 2012.
Their job, however, was made more difficult this week with reports showing that consumer prices increased by 0.3% last month, compared to August, and wholesale prices jumped a monthly 0.8%. The threat of rising inflation limits the central bank's options when it comes to interest-rate policy.
Thursday's report showed that the unemployment rate for workers with unemployment insurance for the week ending Oct. 8 remained unchanged from the prior week at 2.9%.
The state-by-state breakdown in initial jobless claims, which is also released with a lag, showed the biggest rise the week ended Oct. 8 was in California. Claims there rose by 13,882 amid more layoffs in the service industry. The largest decline in claims was in Wisconsin, down 1,536.
3) Dollar Strength Is Killing Stocks & Commodities-From Breakout
According to Clark Yingst, chief market analyst at Joseph Gunnar, the relationship between the dollar and the euro is the market tell of 2011, dominating the tape to the point that other fundamentals are being all but ignored. Yingst says the ratio is getting whipsawed by "the latest reports and rumors emanating from Europe and that's the indicator of the direction U.S. stocks are going that day".
Yinst says market reactions to earnings reports have been strictly company specific, with all other implications for the rest of the respective sectors. Pointing to IBM (gIBM), Yingst says weakness in Big Blue's core businesses "should" have impacted competitors. When an industry leader like this sees weakness in core segments, the news typically puts a dent in related stocks. Instead companies such as Hewlett-Packard (HPQ) moved higher off IBM's results, carried along with the rest of the tape and, not at all coincidentally, a weak dollar.
According to Yingst dollar strength is likely to persist. In September there "appeared to be a real breakout, technically speaking, in the dollar/euro." Pointing to a break of the dollar's 2-year downtrend as well as the 200-day moving average, Yingst forecasts near to intermediate term strength.
"Given the inverse relationship between the dollar/euro and the S&P500, that's a negative for stocks," Yingst concludes.
Quote of the Day from Dave Ramsey.com:
Unless you're willing to have a go, fail miserably, and have another go, success won't happen. — Phillip Adams
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