Stocks bounce around, little impressed by jobs data
NEW YORK -- Stocks zigzagged in a narrow range Thursday after the number of workers continuing to receive unemployment benefits unexpectedly fell for the first time in 20 weeks.
New jobless claims fell to 621,000 from the previous week's revised figure of 625,000, nearly matching analysts' expectations.
The drop, while small, provided investors a nugget of hope that unemployment could be easing. The data also arrived a day ahead of the government's monthly tally of job losses, one of the most important economic indicators for the stock market. Investors watch those numbers closely since growing unemployment can affect core elements of the economy including consumer spending, retail sales and the housing market.
"Today's trading is quiet," said Kent Engelke, chief economic strategist at Capitol Securities Management. "We're just really waiting to see what tomorrow's data is going to bring."
But enthusiasm over unemployment was checked by concerns about the well-being of retailers after many reported lackluster sales for May.
Consumer spending accounts for more than two-thirds of economic activity, so how retailers are faring says a lot about the state of the economy.
The day's news presents a familiar quandary for investors who have been grappling with mixed signals on the economy lately. While some reports indicate the economy's decline is slowing, others show that companies and consumers are still feeling the pain of a deep recession.
The Labor Department reported that productivity, or the amount of output per hour worked, rose at an annual rate of 1.6% during the first quarter, more than analysts had been expecting. Normally an increase in productivity would be a positive factor but in this case the gains were largely a result of the massive layoffs companies made in recent months.
