1.87 Million More Americans File for Unemployment Benefits
U.S. unemployment claims have fallen but were still higher than what analysts had hoped.
According to the U.S. Labor Department, 1.87 million more Americans filed for jobless benefits for the week ending May 30, down from the 2.12 million figure in the prior week. Economists were expecting 1.84 million Americans to file for claims. California reported the largest amount of unemployment claims at a projected 230,000 compared with 203,000 in the previous week. California is the nation's largest state with nearly 40 million residents. The good news, is, however, that this week's report marked the first time that weekly initial jobless claims came in below two million in 10 weeks.
"The downward trend is obviously good news, but in the context of an economy that is re-opening it is extremely high, especially when viewed against previous recessions. It may well be that businesses that had been trying to look after their staff and keep them on the payrolls have had to capitulate," James Knightley, the chief international economist at ING, wrote in a note Thursday.
He added, "For example, social distancing constraints have made the business unviable or demand has not returned as hoped and they have been forced to adjust the numbers of staff to the new reality."
By midday, U.S. benchmarks showed mixed results, as the Dow Jones gained 18 points, while the S&P 500 lost 6 points. One of the biggest gainers today was American Airlines Group Inc., (Nasdaq: AAL) which watched its shares soar 25% after announcing traveling demand has picked up and will increase July flights.
The software as a service company ZoomInfo Technologies Inc., not to be confused with Zoom Video Communications (Nasdaq: ZM) has raised $887 million in its IPO. Trading is expected to commence Thursday for the Vancouver-based company on Nasdaq under the ticker "ZI".
With lost jobs nearing 43 million in the U.S., the government is likely to report that the unemployment rate has increased to 19% or more on Friday according to a MarketWatch survey. Morgan Stanley warned earlier this week that the "shadow" unemployment rate, including people not listed on the official government tally who have long stop searching for work, could be closer to 25%.