There were two important economic reports this morning. The first is that jobless claims fell last week:
Fewer Americans filed claims for jobless benefits last week, another sign the economy is pulling out of the worst recession since the 1930s.
Applications fell by 10,000 to 570,000, a higher level than forecast, in the week ended Aug. 22 from a revised 580,000 the week before, Labor Department data showed today in Washington. The total number of people collecting unemployment insurance fell to the lowest level since April.
Companies’ staff cuts are easing as government stimulus measures help stabilize the housing and manufacturing industries. At the same time, a rebound in hiring will take longer to occur, restraining the consumer spending that accounts for about 70 percent of the economy.
Wall Street was expecting the GDP report to be revised lower, but it was unchanged:
Gross domestic product shrank at a 1 percent annual rate from April to June, the same as calculated last month, a Commerce Department report showed today in Washington. Analysts in a Bloomberg survey forecast a 1.5 percent drop. Corporate profits rose the most in four years, the department also said.
Companies from Wal-Mart Stores Inc. to Macy’s Inc. cut costs and stockpiles to bolster earnings as job losses caused consumers to curb spending. Leaner stocks and government programs to revive demand, including the “cash for clunkers” and first-time homebuyer incentives, are boosting manufacturing and housing, putting the economy on a path to recovery.