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Pre-market futures are lower this morning, following another flat day overall yesterday, and a flat-to-down week thus far. Economic and Q1 earnings reports hitting an hour before the opening bell caused nary a ripple in these levels beyond the initial impacts. The Dow is sitting at -183 points at this hour, the S&P 500 is -32 and the Nasdaq is currently -123 points. We’re down 1% or less on each of these indices over the past five sessions.
Initial Jobless Claims were a tick above expectations this morning, to 245K new claims from a slightly upwardly revised 240K the previous week. This is the highest level in new jobless claims since the last week in March, although that was back before the benchmark revisions which now properly account for the increased layoffs we’ve seen in the labor force over the past few months.
Continuing Claims also ratcheted up higher, to 1.865 million longer-term jobless claims — the highest single-week read since November 2021. This is higher than the 1.825 million expected, and the previous week’s downwardly revised 1.804 million. Again, the benchmark revisions have brought these figures more in tune with reality; previously, we were still below 1.7 million longer-term claims, which is illustrative of an historically robust labor market. And, as Continuing Claims report a week in arrears from Initial Claims, we may expect a further downward shift a week from now.
Philly Fed numbers for April were also worse than expected: -31.3 is the lowest print since the dog days of Covid, May 2020. It also marks the ninth straight negative headline for manufacturing in the sixth-most-populated city in the U.S., and the 10th down read in the past 11 months. On a positive note, we also saw its Prices Paid Index down to the lowest levels since the pandemic in today’s report.
The good news here, should we be willing to see it, is that this is further evidence of an economy slowly grinding down — especially in jobless claims numbers, which had been lagging other economic metrics until recently. Why that’s good is it still has a chance of changing the Fed’s collective mind regarding interest rate hikes at its next meeting in a couple weeks. But we’ll need to see a much-weaker-than-expected Personal Consumption Expenditures (PCE) report a week from tomorrow to really accentuate this possible change in policy.
American Express (AXP - Free Report) continues this second-leg of Q1 earnings season, which is hitting a patch of disappointment across industries. After Tesla’s (TSLA - Free Report) weaker showing yesterday afternoon, AmEx missed earnings estimates: $2.40 per share versus $2.64 expected and $2.73 per share reported in the year-ago quarter. This was due to a $1.1 billion hit on loss provisions. Revenues in the quarter actually came out ahead by nearly +2%: $14.28 billion, which is an all-time high. But credit concerns among consumers is apparently evident here, another notch for a weakening economy. For more on AXP's earnings, click here.
Questions or comments about this article and/or its author? Click here>> https://www.zacks.com/bio/mark-vickery
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Jobless Claims Higher, Philly Fed & AmEx Lower
Thursday, April 20th, 2023
Pre-market futures are lower this morning, following another flat day overall yesterday, and a flat-to-down week thus far. Economic and Q1 earnings reports hitting an hour before the opening bell caused nary a ripple in these levels beyond the initial impacts. The Dow is sitting at -183 points at this hour, the S&P 500 is -32 and the Nasdaq is currently -123 points. We’re down 1% or less on each of these indices over the past five sessions.
Initial Jobless Claims were a tick above expectations this morning, to 245K new claims from a slightly upwardly revised 240K the previous week. This is the highest level in new jobless claims since the last week in March, although that was back before the benchmark revisions which now properly account for the increased layoffs we’ve seen in the labor force over the past few months.
Continuing Claims also ratcheted up higher, to 1.865 million longer-term jobless claims — the highest single-week read since November 2021. This is higher than the 1.825 million expected, and the previous week’s downwardly revised 1.804 million. Again, the benchmark revisions have brought these figures more in tune with reality; previously, we were still below 1.7 million longer-term claims, which is illustrative of an historically robust labor market. And, as Continuing Claims report a week in arrears from Initial Claims, we may expect a further downward shift a week from now.
Philly Fed numbers for April were also worse than expected: -31.3 is the lowest print since the dog days of Covid, May 2020. It also marks the ninth straight negative headline for manufacturing in the sixth-most-populated city in the U.S., and the 10th down read in the past 11 months. On a positive note, we also saw its Prices Paid Index down to the lowest levels since the pandemic in today’s report.
The good news here, should we be willing to see it, is that this is further evidence of an economy slowly grinding down — especially in jobless claims numbers, which had been lagging other economic metrics until recently. Why that’s good is it still has a chance of changing the Fed’s collective mind regarding interest rate hikes at its next meeting in a couple weeks. But we’ll need to see a much-weaker-than-expected Personal Consumption Expenditures (PCE) report a week from tomorrow to really accentuate this possible change in policy.
American Express (AXP - Free Report) continues this second-leg of Q1 earnings season, which is hitting a patch of disappointment across industries. After Tesla’s (TSLA - Free Report) weaker showing yesterday afternoon, AmEx missed earnings estimates: $2.40 per share versus $2.64 expected and $2.73 per share reported in the year-ago quarter. This was due to a $1.1 billion hit on loss provisions. Revenues in the quarter actually came out ahead by nearly +2%: $14.28 billion, which is an all-time high. But credit concerns among consumers is apparently evident here, another notch for a weakening economy. For more on AXP's earnings, click here.
Questions or comments about this article and/or its author? Click here>>
https://www.zacks.com/bio/mark-vickery