The numbers: One week after falling to the lowest level since 1969, initial U.S. jobless claims rebounded but only slightly. Claims rose by 2,000 to 211,000 in the seven days ended April 28—well below the average of 225,000 forecast of economists surveyed by MarketWatch.
The more stable monthly average of claims decreased by 7,750 to 221,500, the government said Thursday. That is the lowest level since March 1973.
The number of people already collecting unemployment benefits, known as continuing claims, fell by 77,000 to 1.76 million.
What happened: Claims were set to rebound after last week’s surprising drop to a 49-year low. The decline was seen as exaggerated by the timing of spring break in New York, where some school employees can collect benefits for the week they miss when school is closed.
Big picture: The U.S. labor market is in the best shape of the nine-year expansion. The low level of claims suggests that solid job growth will continue and the unemployment rate will continue to fall. Economists expect the unemployment rate to fall to 4% in April, a 17-year low. The government will release the employment report on Friday.
What they are saying: “On the face of it...this report might suggest that the trend in claims has fallen yet further, but we are reluctant to put too much weight on just one week’s numbers. Still, the trend remains very low indeed,” Ian Shepherdson, chief economist, Pantheon Macroeconomics.
Market reaction: The Dow Jones Industrial Average DJIA, -1.09% and S&P 500 index SPX, -1.00% opened lower on Thursday.