U.S. companies say consumer still strong even as broader outlook dims By Reuters


© Reuters. People shop during a Black Friday sales event at Macy’s flagship store in New York City

By Caroline Valetkevitch

NEW YORK (Reuters) – Walmart (NYSE:) became the latest company to point to a strong U.S. consumer, adding to a raft of firms in recent weeks citing healthy demand at a time when spending is seen as an increasingly key support for the economy.

Several companies including banks and homebuilders have painted an upbeat picture of consumer health in conference calls this reporting season, even as many firms have offered more dour outlooks especially given the lingering U.S.-China trade war.

Reports of strong demand from companies are a welcome sign to some in the market amid weakening manufacturing activity and a slump in business investment.

Data showed U.S. economic growth slowed less than expected in the third quarter as resilient consumer spending offset a further contraction in business investment, and many strategists remain confident in consumers’ ability to support the economy.

“I’m in that camp. We are now in this job market where the consumer has the advantage versus employers,” said Lindsey Bell, chief investment strategist at Ally Invest in Charlotte, North Carolina.

Lower interest rates, which mean reduced borrowing costs, are giving people more money to spend, and that’s likely to be the case for the first half of next year as well, she said.

On Thursday, Walmart Inc raised its annual outlook and its chief financial officer, Brett Biggs, told Reuters spending going into the crucial holiday season remained healthy.

Focus on spending at retailers will remain high next week, when a wide range of retailers report results, wrapping up the reporting period. They include Target Corp (NYSE:), Home Depot Inc (NYSE:), Gap Inc (NYSE:) and Macy’s Inc.

Homebuilder Lennar Corp (NYSE:), MasterCard and Tapestry were among companies alluding to healthy consumer spending during the current reporting period.

In JPMorgan (NYSE:) Chase’s Oct. 15 earnings call, Chief Financial Officer Jennifer Piepszak said uncertainty related to trade may be impacting some investing but the U.S. consumer is “incredibly strong.”

“Sentiment is strong for the consumer, credit is good,” she said.

The number of companies mentioning a strong consumer in the third-quarter season is roughly in line with the number in the second-quarter reporting period.

To be sure though, business investment has been easing, and plenty of companies have given a more cautious view of the outlook. Among them, Cisco Systems Inc (NASDAQ:) late on Wednesday forecast revenue and profit below expectations and said increasing global economic uncertainties were weighing on client spending.

Also, analysts have been cutting earnings forecasts for the fourth quarter and 2020, while third-quarter earnings for are on track to fall slightly from a year ago, which would be the first quarterly profit decline for the group since 2016, according to IBES data from Refinitiv.

Banking on the consumer is a risk at this point, said Richard Bernstein, chief executive of Richard Bernstein Advisors LLC in New York.

“If we get a profits recession, you’re going to see the employment situation start to change,” said Bernstein, who spoke at the Reuters Global Investment Outlook 2020 Summit in New York last week.

Investors will seek further clues from reports on spending trends ahead of the holiday shopping period, when many retailers get a big part of their annual sales.

A report Friday on U.S. retail sales for October could be among them.



Walmart posts strong results ahead of holidays, earns praise from Trump By Reuters


© Reuters. A customer pushes a shopping cart at a Walmart store in Chicago

By Nandita Bose

WASHINGTON (Reuters) – Walmart Inc (N:) posted strong results on Thursday as a strong economy boosted purchases at its stores and website and the retailer picked up market share in food and other groceries, earning praise from U.S. President Donald Trump.

The world’s largest retailer has now posted a 21-quarter, or more than five-year, streak of U.S. growth, unmatched by any other retail chain. Its shares rose 1.9 percent in early trade, and helped lift other retailers, including Target Corp (N:) and Macy’s Inc (N:).

Trump used Walmart’s performance to say U.S. tariffs, imposed by his administration on imports from China, have had little impact on consumers.

“Walmart announces great numbers. No impact from Tariffs (which are contributing $Billions to our Treasury)…,” Trump said in a tweet.

Consumer spending going in to the crucial holiday season remains healthy, Chief Financial Officer Brett Biggs told Reuters in an interview on Thursday. Retailers earn a sizeable chunk of their annual revenue during November and December.

“The consumer remains in pretty good shape, employment situation is good, fuel prices are low … wage growth is pretty good,” he said.

Walmart has also managed to minimize the impact from U.S. tariffs on Chinese imports, Biggs said. “I think we’ve muted the impact (of tariffs) pretty well up to this point.”

The retailer gets 56% of its revenue from food and grocery sales, which allows it to manage the pressure from tariffs better than many rivals, analysts said.

Earlier this week, Trump dangled the prospect of completing an initial trade deal with China “soon,” but offered no new details on negotiations.

In October, Walmart said its chief executive for U.S. operations, Greg Foran, who was responsible for turning around the business, will leave the company and be replaced by the head of its Sam’s Club warehouse chain unit, John Furner.

The U.S. business has “a lot of momentum,” Furner, who took charge on Nov. 1, told reporters on Thursday. His priority is to maintain that pace until the end of the holiday season, he added.

The company is focused on spreading out sales during this year’s compressed holiday season, instead of focusing on a few big days, executives said.

Online sales rose 41%, higher than the previous quarter’s increase of 37 pct and greater than the company’s expectation of 35%.

“Our strength is being driven by food, which is good, but we need even more progress on Walmart.com with general merchandise,” CEO Doug McMillon said in a statement.

Food typically has lower margins and does not drive online profitability, which has continued to suffer for the retailer.

Operating income fell 5.4 percent to $4.7 billion as a result of ongoing investments in e-commerce including faster delivery.

Losses at the U.S. e-commerce business could rise to about $1.7 billion this year from $1.4 billion in 2018, according to estimates from Morgan Stanley (NYSE:).

U.S. e-commerce chief Marc Lore said improving operating profitability is a key area of focus for the company.

Sales at U.S. stores open at least a year rose 3.2%, excluding fuel, in the quarter ended Oct.31. Analysts estimated growth of 2.9%, according to IBES data from Refinitiv.

Adjusted earnings per share increased to $1.16 per share, beating expectations of $1.09 per share.

Walmart forecast earnings per share, including the impact from its acquisition of Indian e-commerce retailer Flipkart, to increase “slightly” from a year ago.

Total revenue rose 2.5 percent to $128 billion.



Gold, Silver Coast Together in Strong Weekly Gains Ahead of Fed By Investing.com


© Reuters.

Investing.com – Gold hit two-week highs Friday, advancing in the $1,500 channel in further buildup to expectations of an impending Fed rate cut.

But the real story in precious metals belonged to silver, which rode the winds of a technical move to its biggest weekly gain in three months.

for December delivery settled up a modest 60 cents at $1,505.30 per ounce by 2:35 PM ET (18:35 GMT). In post-settlement trade, it was up $3.25, or 0.2%, at $1.507.95 by 2:35 PM ET (18:35 GMT).

, which tracks live trades in bullion, was up $1.62, or 0.1%, at $1,505.38.

Gold returned to $1,500 on Thursday, two weeks after dropping off that bullish perch, amid expectations that the Fed’s Oct. 29-30 policy decision will yield in a third-straight rate cut for this year. Investing.com’s showed a 91% chance that the U.S. central bank will approve another quarter-point easing as it did in July and September.

Gold is up around 17% on the year, emerging as one of the best performers among commodities in 2019, as investors plowed into the safe haven amid currency devaluations, recession fears, Brexit uncertainty and other tensions involving China and Iran.

U.S. for December delivery settled up 12.20 cents, or 0.7%, at $17.93 per ounce. For the week, it posted a 2% gain, and for the year 14%.

“Silver has been the main outperformer in recent days as under invested traders appear to pile in on both precious and industrial optimism,” TD Securities said in a note. “The break of the short-term downtrend since September and a 50-Day Moving Average also offers some short term juice for the metal.”

Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.



Despite Pullback in Bitcoin Prices, Investor Interest Is Strong By Cointelegraph


© Reuters. CME: Despite Pullback in Bitcoin Prices, Investor Interest Is Strong

The Chicago Mercantile Exchange (CME) Group recently tweeted that, despite the (BTC) price pullback, customer interest in futures remained strong during Q3 2019.

On Oct. 9, the CME Group (NASDAQ:) took to Twitter to state that customer interest in CME Bitcoin futures remained strong during Q3 2019, with daily open interest (OI) of over 4,600 contracts, up 61% vs Q3 2018, because of the strong interest of institutional investors.

Continue Reading on Coin Telegraph

Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.



Data will show damage of tariffs, strong dollar on U.S. goods exporters By Reuters



By Stephen Culp

NEW YORK (Reuters) – It’s no longer a probability, it’s a reality: the escalating U.S.-China trade war and the strengthening dollar appear to be inflicting measurable damage on U.S. goods makers that rely on global markets.

Market participants will get a picture of the extent to which trade tensions and currency have hurt U.S. manufacturers when the Institute for Supply Management (ISM) releases its purchasing managers index (PMI) for September on Tuesday.

Its August report showed the manufacturing sector, which accounts for about 12% of the U.S. economy, contracting in for the first time in 3-1/2 years, and more worryingly, its export component hit a more than 10-year low.

“The exporters are at least a half a step or full step closer to the predicted recession,” said Robert Pavlik, chief investment strategist, senior portfolio manager at SlateStone Wealth LLC in New York.

The August report’s New Export Orders plunged to 43.3, its lowest level since April 2009, when the United States was in the throes of the great recession.

A PMI reading below 50 indicates contraction.

In the August PMI survey, manufacturers told ISM “business is starting to show signs of a broad slowdown,” and that “tariffs continue to be a strain on the supply chain and the economy overall.”

China already has implemented tariffs on about $110 billion in U.S. goods, in return for President Donald Trump’s tariffs on Chinese imports. Beijing announced additional retaliatory increases in August. The first tranche took effect at the beginning of this month and the second is due to follow on Dec. 15.

U.S. goods would already be more expensive on global markets due to a stronger dollar, which has been boosted by simmering geopolitical unease and negative interest rates in Europe. Market-rattling tit-for-tat tariff hikes from Washington and Beijing have created a perfect storm.

“Geopolitical tensions do two things,” said Peter Tuz, president of Chase Investment Counsel in Charlottesville, Virginia. “They compel big companies to sit back and not spend as much as they would.”

“And as tensions increase and the dollar rises, (U.S.)products become more expensive and you see demand fall off.”

The (), which measures the greenback against a basket of major world currencies, hit a 29-month high on Sept. 3, the very day ISM released its dismal PMI report.

(Graphic: ISM export orders and the dollar Image, https://graphics.reuters.com/USA-STOCKS/0100B2D01H7/ISM-DXY.png)

Indeed, in the first quarter of 2018, during which Trump fired the opening salvo in the trade war, the negative currency impact on North American corporate earnings was an estimated $40 million, according to cloud treasury services firm Kyriba. One year later, that number ballooned to $23.4 billion.

The arrival of third-quarter earnings season next month will provide a clearer view of the damage the trade war and strong dollar have wrought on companies’ bottom lines.

Over the last year, third-quarter analyst earnings estimates for a basket of 15 top U.S. exporters by dollar value have dropped by an average of 17.3%, according to Refinitiv data, and by 12.3% in the last three months.

(Graphic: Earnings estimates Image, https://graphics.reuters.com/USA-STOCKS/0100B2D11H8/earnings-est-changes.png)

Fourth-quarter estimates for the same companies have been revised down 15.6% on average since September 2018 by 10.3% since June.

Third-quarter earnings estimates for Apple Inc (O:) are 7.4% lower than they were a year ago, and down 16.7% for the essential October-December holiday quarter. Non-U.S. revenue contributes 63.1% of the iPhone maker’s total.

General Electric Co (N:) gets about 61.5% of its revenue from abroad. Analysts currently see the conglomerate’s third-quarter earnings coming in 44.6% below the level seen a year ago, and its fourth-quarter EPS estimates are now 43.5% lower.

Chipmakers, particularly vulnerable to trade concerns and technology exchange issues, have seen their earnings estimates slashed most.

Micron Technology Inc (N:) relies on non-U.S. business for 88.1% of its revenue. Third quarter earnings estimates for the company have plunged 83.4% over the last year and 42% from last quarter.

Overseas customers contribute 97.4% of Qualcomm Inc’s (O:) revenue. Analysts have slashed their third quarter earnings estimates for the company by 47.7% over the last year.

Nike Inc (N:), which derives 62.5% of its revenues from overseas, reported its first-quarter earnings for fiscal year 2020 on Tuesday. The sportswear company’s revenue and profit beat analyst estimates, but it said currency and trade concerns remained headwinds and it expects the impact of tariffs will be “most pronounced” in the current quarter.

“The manufacturing side of our economy is in the early stages of a recession and we should be concerned about the possibility of a full recession spreading here and around the world,” said Tim Ghriskey, chief investment strategist at Inverness Counsel in New York.

“If (the ISM PMI) export number remains weak that will point to deepening overseas weakness,” Ghriskey added. “But a strong number would surprise me given what’s happening around the world.”



Dollar Gains on Strong PPI Data; Loonie Slips as Oil Prices Slump By Investing.com


© Reuters.

Investing.com – The dollar rose on Wednesday as U.S. bond yields continued to edge higher on hot inflation data, while a retreat in the amid falling prices also boosted the greenback.

The , which measures the greenback against a trade-weighted basket of six major currencies, rose by 0.33% to 98.65.

The Labor Department said its for final demand increased 0.1% last month, in line with economists’ forecasts. In the 12 months through August, the PPI rose 1.8%, ahead of forecasts of 1.7%.

The , which excludes food and energy prices, rose 0.3% in August, more than the 0.2% rise forecast. The was 2.3%, edging above estimates of 2.2%.

“The uptick in the pace of wholesale prices supports our general inflation view that a tight labor market and more generally a tight economy – excluding manufacturing – are beginning to deliver a modest pickup in underlying price pressures,” Pantheon Macroeconomics said in a note.

The inflation data dimmed expectations somewhat that the Federal Reserve will cut rates aggressively at its meeting next week, boosting Treasury yields, with the yield up about 2% to 1.735%.

The dollar also racked up gains against the loonie, with trading up 0.36% following a fall in oil prices despite a bigger-than-expected draw in U.S crude stockpiles.

The loonie started the day on the back foot amid added political uncertainty in Canada ahead of an election on Oct. 21.

Canadian Prime Minister Justin Trudeau’s Liberal Party is expected to win, albeit with a small majority.

fell 0.31% to $1.101 ahead of the European Central Bank meeting Thursday, with many expecting the central bank to deliver fresh stimulus.

rose 0.21% to Y107.75 and fell 0.15% to $1.233

Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.





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Wall Street rises on strong Chinese data, Hong Kong and Brexit news


New York (Reuters) – Wall Street’s main indexes rebounded on Wednesday, after robust economic data from China, easing tensions in Hong Kong and British lawmakers’ approval of a law to delay Brexit provided a dose of optimism to investors worried about global growth.

FILE PHOTO: A trader works on the trading floor at the New York Stock Exchange (NYSE) in New York City, U.S., September 3, 2019. REUTERS/Andrew Kelly

Lawmakers in Britain’s lower house of Parliament voted to approve legislation designed to prevent Prime Minister Boris Johnson’s government from taking the country out of the European Union without a deal.

In China, activity in the services sector expanded at the fastest pace in three months in August, providing a boost to the world’s second-largest economy, which has been struggling to reverse a prolonged slump in its manufacturing sector.

Hong Kong leader Carrie Lam withdrew an extradition bill that had triggered months of often violent protests in the Chinese-ruled city.

“Some of the pessimism we started the month off with has eased slightly,” said Chris Zaccarelli, chief investment officer at Independent Advisor Alliance, in Charlotte, North Carolina.

“Anything that happens that could possibly derail a hard Brexit is a positive for stocks,” said Zaccarelli, who also pointed to economic data from China and Germany and the news from Hong Kong.

The president of the New York Federal Reserve Bank, John Williams, said the U.S. economy appeared to be in a good place while saying that he is ready to “act as appropriate” to help avoid a downturn.

The combination of news provided some relief after investors fled equities on Tuesday following data that showed a contraction in U.S. factory activity in August and after a new round of tariffs from Washington and Beijing began over the weekend.

The Federal Reserve’s Beige Book released on Wednesday, showed that the U.S. economy grew at a modest pace in recent weeks, with manufacturing buffeted by a global slowdown while consumer purchases gave mixed signals. The report is a compendium of anecdotes from companies around the country.

The benchmark U.S. Treasury 10-year yield US10YT=RR rose on Wednesday, with the yield curve at its steepest in more than two weeks.

At 3:27PM, the Dow Jones Industrial Average .DJI rose 217.91 points, or 0.83%, to 26,335.93, the S&P 500 .SPX gained 28.92 points, or 1.00%, to 2,935.19 and the Nasdaq Composite .IXIC added 96.59 points, or 1.23%, to 7,970.74.

Technology stocks .SPLRCT provided the biggest boost of the S&P’s 11 major sectors with a 1.5% gain. The only sector in the red was healthcare .SPXHC, which was down 0.3%.

Tyson Foods Inc (TSN.N) shares fell 7% after the biggest U.S. meat processor cut its 2019 earnings forecast.

Starbucks Corp (SBUX.O) dropped 0.9% after the company said it expects 2020 adjusted profit growth to be lower than 2019 as it factors in the impact of a one-time tax benefit that has inflated its bottom line this year.

Advancing issues outnumbered declining ones on the NYSE by a 3.85-to-1 ratio; on Nasdaq, a 2.08-to-1 ratio favored advancers.

The S&P 500 posted 64 new 52-week highs and three new lows; the Nasdaq Composite recorded 57 new highs and 74 new lows.

Reporting by Sinead Carew; Additional reporting by Uday Sampath and Shreyashi Sanyal in Bengaluru; Editing by Leslie Adler



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Gold Prices Down Amid Strong Equity Markets By Investing.com


© Reuters.

Investing.com – Gold prices fell on Monday in Asia as Asian equities traded higher.

The benchmark contract on New York Mercantile Exchange’s Comex dropped 0.3% to $1,519.65 by 1:20 AM ET (05:20 GMT).

The fall in gold prices came as Asian stock markets recovered today. Hong Kong’s Hang Seng Index jumped 2%, while Chinese stocks also gained more than 1.7%.

Wednesday’s release of the Fed meeting minutes for July, along with the Thursday-through-Saturday Jackson Hole retreat, and Chairman Jay Powell’s speech on Friday are expected to dictate gold price movement this week.

Traders will also keep an eye out on developments on the Sino-U.S. trade front, as U.S. President Donald Trump reiterated on the weekend that he is not ready to make a trade deal with China, hinting that he wants China to solve the problems in Hong Kong in a humanely way first.

Despite the losses today, analysts said safe-haven demand for gold remained strong.

“Precious metals may have benefited from equity angst and recession fears this week, but the lack of bad news is spurring some consolidation,” TD Securities said in a note on gold.

Since the start of August, gold has gained over 6%, or about $90, on heightened trade tensions and sustained buying by central banks responding to a slew of disappointing economic data globally.

Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.



Wall Street set to open higher after strong retail sales data


(Reuters) – U.S. stock index futures rose in volatile trading on Thursday, as strong July retail sales data and Walmart’s upbeat results eased some concerns about the economy slipping into recession, while mixed reports on the trade dispute kept investors on edge.

FILE PHOTO: A screen shows the numbers after the closing bell at the New York Stock Exchange (NYSE) in New York, U.S., August 14, 2019. REUTERS/Eduardo Munoz

The bounce in shares comes after the blue-chip Dow index posted its worst day this year, as recession fears gripped the market after the U.S. Treasury yield curve inverted for the first time in 12 years. [US/]

Sentiment got a boost after the Commerce Department said retail sales rose 0.7% in July, much higher than the expectations of a 0.3% rise, as consumers bought a range of goods even as they cut back on motor vehicle purchases.

“The July number shows that the weakest economic data that people keep pointing out to for a global slowdown is coming from outside the U.S. not inside the U.S.,” said Randy Frederick, vice president of trading and derivatives for Charles Schwab in Austin.

Futures initially dived after China’s finance ministry said on Thursday it would take necessary counter-measures against the latest tariffs on $300 billion of Chinese goods.

However in a separate statement, a Chinese foreign ministry spokeswoman said, “We hope the U.S. will meet China halfway, and implement the consensus of the two heads of the two countries in Osaka,” drove a turnaround in shares.

“It doesn’t matter where we are right now. The number of variables affecting this market are increasing,” said Andre Bakhos, managing director at New Vines Capital LLC in Bernardsville, New Jersey.

Walmart Inc shares rose 6.8% after the retailer reported second-quarter U.S. comparable sales that beat estimates and boosted its earnings forecast for the year.

In contrast, Dow component Cisco Systems Inc dropped 7.5% after the Dow component blamed the bruising trade war for poor quarterly forecasts.

The network gearmaker said prices of some items sold by the retailer have climbed due to tariffs on Chinese imports, but it is managing that pressure by negotiating with suppliers and sourcing from alternate supply bases.

At 8:43 a.m. ET, Dow e-minis were up 108 points, or 0.42%. S&P 500 e-minis were up 11.75 points, or 0.41% and Nasdaq 100 e-minis were up 30.25 points, or 0.4%.

Trade worries have plagued financial markets for at least a year fuelling fears of recession, and traders have raised their bets on three rate cuts this year including one in September to sustain a decade-long bull market run on Wall Street.

The benchmark S&P 500 is now 6.6% away from its all-time high hit in July.

Reporting by Amy Caren Daniel and Arjun Panchadar in Bengaluru



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U.S. weekly jobless claims fall; labor market strong


WASHINGTON (Reuters) – The number of Americans filing applications for unemployment benefits unexpectedly fell last week, suggesting the labor market remains strong even as the economy is slowing.

FILE PHOTO: People wait in line to attend TechFair LA, a technology job fair, in Los Angeles, California, U.S., January 26, 2017. REUTERS/Lucy Nicholson

Initial claims for state unemployment benefits declined 8,000 to a seasonally adjusted 209,000 for the week ended Aug. 3, the Labor Department said on Thursday. Data for the prior week was revised to show 2,000 more applications received than previously reported.

Last week’s drop in claims pushed them to the lower end of their 193,000-244,000 range for this year. Economists polled by Reuters had forecast claims would be unchanged at 215,000 in the latest week. The Labor Department said only claims for Idaho were estimated last week.

The four-week moving average of initial claims, considered a better measure of labor market trends as it irons out week-to-week volatility, edged up 250 to 212,250 last week.

U.S. stock index futures held gains after the release of the data. Prices of U.S. Treasuries dipped while the dollar .DXY was trading slightly higher.

Claims will be watched over the coming weeks for signs that deteriorating trade relations between the United States and China, which have dimmed the economy’s outlook and roiled financial markets, were spilling over to the labor market.

Concerns over the impact of the bitter trade war between Washington and Beijing on the U.S. economic expansion, the longest on record, prompted the Federal Reserve to cut interest rates last week for the first time since 2008.

With tensions between the two economic giants escalating in recent days and recession risks rising, financial markets have fully priced in another rate cut next month. Expectations for a 50-basis-point cut at the Fed’s Sept. 17-18 policy meeting have also risen.

While hiring has slowed, the pace of job gains remains well above the roughly 100,000 needed per month to keep up with growth in the working-age population.

Nonfarm payrolls increased by 164,000 jobs in July, down from 193,000 in June. Job growth over the last three months averaged 140,000 per month, the lowest in nearly two years, compared to 223,000 in 2018. The moderation in employment growth partly reflects a shortage of workers.

The economy grew at a 2.1% annualized rate in the second quarter, slowing from the first quarter’s brisk 3.1% pace. Growth is seen below a 2.0% rate in the July-September quarter.

Thursday’s claims report also showed the number of people receiving benefits after an initial week of aid dropped 15,000 to 1.68 million for the week ended July 27. The four-week moving average of the so-called continuing claims fell 11,000 to 1.69 million.

Reporting by Lucia Mutikani; Editing by Paul Simao



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