“Less Bad” Numbers

This morning’s announcement by the BLS that Initial Jobless Claims rose by 2.12M for the week ending May 23rd was slightly higher than the 2.1M that was expected, but the 21.01M Continuing Claims for the prior week was far less than the 25.7M that was anticipated. Perhaps a sign that some previously laid-off workers are returning to their jobs.

Also out this morning was a report that Durable Goods Orders in April fell 17.2%; less than the 19% that was forecast. Without Transportation, the decline was only 7.4%. Coming in slightly worse than expected was the second estimate of Q1 GDP. The previously announced dive of 4.8% has become a deeper dive of 5% contraction. Along with that report, Personal Consumption in the first quarter slid 6.8% versus the previously estimated 7.5%. For a read on inflation last quarter, the Personal Consumption Expenditures Index without food and energy now looks like 1.6% and that’s a bit less than the previously estimated 1.8%.

Market behavior is still being predominantly driven by the degree and type of fiscal and monetary intervention along with virus eradication hopes, but with reopening underway, economic fundamentals may start to garner more attention as the nation’s businesses continue to resume operations. In early trading, a slight sell-off has the Ten-Year’s yield at the threshold of 70 basis points while equities are poised to begin another day in the green. WTI is off slightly at $32.50/barrel with gold up around $13 to $1,723.

Later today, Pending Home Sales are expected to report a 17% drop in April, followed by a manufacturing report from the Kansas City Fed.