• US stock market daily report (April 30, 2015, Thursday)

    On Thursday, the U.S. Labor Department reported initial jobless claims for state unemployment benefits fell 34,000 to a seasonally adjusted 262,000 for the week ended April 25, striking the lowest reading in 15 years since April 2000.

    Jobless data suggests moderation in job growth during March was likely an aberration as claims remained below 300,000 for the eighth consecutive week.

    Considered a better measure of labor market trends as it irons out week-to-week volatility, the four-week moving average of claims fell 1,250 last week to 283,750.

    The U.S. Commerce Department said on Thursday that during March, consumer spending rose 0.4% as households stepped up purchases of big-ticket items like automobiles and major household appliances. The overall pick up of consumer spending bodes well for consumption during the April-June period.

    Adjusted for inflation and despite flat personal income, consumer spending rose 0.3% during March. Income weakness is expected to be temporary as the labor market gradually tightens.

    Consumer spending accounts for more than two-thirds of U.S. economic activity.

    The U.S. Labor Department said the Employment Cost Index (ECI) - the broadest measure of labor costs - advanced 0.7% for the largest gain since Q3 2014, after an unrevised 0.5% increase during Q4 2014.

    Wages and salaries account for 70% of employment costs which rose 0.7% during Q1 2015. Private sector wages and salaries increased 0.7%, for the largest rise since Q3 of 2014.

    Policymakers and economists view the ECI as one of the better measures of labor market slack.

    Labor costs rose 2.6% during the 12 months through March 2015, striking the largest rise since Q4 2008. In the 12 months through December 2014, Labor costs increased 2.2%. In the 12 months through March, private sector wages and salaries were up 2.8% striking the biggest gain since Q3 2008, after rising 2.2% during the 12 months through December 2014.

    Contributed by Millennium Traders
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