Applications for U.S. jobless benefits were flat last week at a seasonally adjusted 374,000, the Labor Department said Thursday. Economists surveyed by MarketWatch had projected claims would fall to 370,000. Initial claims from two weeks ago were revised up to 374,000 from an original reading of 372,000, based on more complete data collected at the state level. The average of new claims over the past month, meanwhile, rose by 1,500 to 370,250. The four-week average reduces seasonal volatility in the weekly data and is seen as a more accurate barometer of labor-market trends. Also, Labor said continuing claims decreased by 5,000 to a seasonally adjusted 3.32 million in the week ended Aug. 18. Continuing claims reflect the number of people already receiving benefits. About 5.53 million people received some kind of state or federal benefit in the week ended Aug. 11, down 62,253 from the prior week. Total claims are reported with a two-week lag.
U.S. personal spending rose the most in five months in July, meeting economists’ expectations, according to a Commerce Department report. Personal incomes rose for the eighth-straight month and matched economists’ average forecast. The core price index for personal consumption expenditures, a gauge of inflation that excludes volatile food and energy prices, was little changed from a month earlier.
Rounding out the data calendar, a reading on manufacturing activity in the Kansas City region is due out at 11 a.m.
Investors were awaiting Federal Reserve Bank Chairman Ben Bernanke’s speech at the annual economic symposium in Jackson Hole, Wyo., on Friday.
Confidence among euro-zone consumers and businesses fell to its lowest in three years in August, below economists’ forecasts and suggesting that the debt-saddled currency bloc’s economy has further to fall.
The European Commission said Thursday its monthly Economic Sentiment Indicator fell to 86.1 in August from 87.9 in July, the fifth straight monthly drop and the weakest level for the combined gauge of business and household sentiment since August 2009.
Consumer confidence fell particularly sharply, to an index reading of minus 24.6 from minus 21.5, marking its lowest since June 2009. The mood in both the industrial and services sectors was also at its lowest in around three years.
Italy sold 7.29 billion euros of debt at its first auction in a month, and shifted the maximum targeted amount of a new 10-year bond at a yield well under its 6 percent pain threshold…
… In Beijing, German Chancellor Angela Merkel appeared to temper China’s fears about the damage the crisis could wreak on the world economy, enough to elicit an undertaking that China would, under certain conditions, buy more euro zone bonds.
Since ECB President Mario Draghi vowed a month ago to do whatever it takes to save the euro, Spanish and Italian bond yields have fallen markedly, particularly for shorter-dated maturities. Now he has to follow through.
At a policy meeting next week Draghi is expected to reveal the ECB’s terms of engagement for intervening in the bond market, reconciling a resistant German Bundesbank to the plan while avoiding conditions that will scupper its effectiveness.
Japan’s retail sales fell in July more than economists had predicted, a release from the trade ministry in Tokyo showed. Sales slipped 0.8 percent from a year earlier, their first drop in eight months. The median estimate of economists in a Bloomberg survey had called for a 0.1 percent decline.
In South Korea, confidence among manufacturers stayed near the lowest level since 2009, a report showed. An index measuring expectations for September had a reading of 75, compared with 70 for August, the Bank of Korea said.
Costco [COST 97.11 ] – The warehouse retailer reported an August same-store sales increase of 6 percent, above Street estimates of a 4.5 percent rise.
Limited Brands [LTD 47.77 ] – Limited saw an August same-store sales rise of 8 percent versus estimates of a 4.2 percent rise.
Pier 1 Imports [PIR 18.24 ] – The retailer is forecasting fiscal second quarter earnings slightly ahead of analyst estimates, saying customers are responding well to its new merchandise lineup.
Sears Holdings [SHLD 57.45 ] – The retailer’s shares have lost their spot in the S&P 500 index. S&P notes that Sears’ public float has been well below the 50 percent threshold required for inclusion for some time now, and will replace Sears with chemical maker LyondellBassell [LYB 46.89 ]. Sears — in one corporate form or another — has been in the S&P 500 since it was created 55 years ago, and was in the Dow Industrials from January 1924 until November 1999.
Pandora Media [P 10.08 ] – The internet music service reported a breakeven second quarter, compared to analyst estimates of a $0.03 per share loss. It also sees current quarter revenues above Wall Street’s estimates, as it moves to attract more listeners and sell more mobile ads.
TiVo [TIVO 9.36 ] – TiVo lost $0.23 per share for the second quarter, slightly smaller than the $0.24 loss analysts had been projecting. The digital video recorder maker saw continued growth in its subscriber numbers, but also reported higher expenses as well.
Vera Bradley [VRA 23.62 ] – The company earned $0.33 per share for the second quarter, two cents below estimates, and the women’s accessories retailer also projected fiscal year earnings and revenues below Street estimates.
Barclays [BCS 11.75 ] – The bank has picked its retail boss Antony Jenkins as its new chief executive officer, replacing Bob Diamond.
We’ll watch housing stocks like Lennar [LEN 32.22 — UNCH ], Pulte Group [PHM 13.40 — UNCH ], and D.R. Horton [DHI 18.75 — UNCH ] after RealtyTrac reported that the raw number of foreclosure home sales dropped 22 percent during the second quarter from a year earlier.
Teva Pharmaceutical [TEVA 40.20 ] – The drugmaker has won FDA approve to market its version of Amgen’s [AMGN 83.72 ] Neupogen a drug that boosts production of white blood cells in certain cancer patients. This drug was the subject of patent litigation with Amgen, which ended last year with an agreement by Teva to refrain from launching its version in the U.S. until November 2013.
Louisiana-Pacific [LPX 13.28 ] has been downgraded to “hold” from “buy” at Deutsche Bank. The firm says the stock’s current price represents fair value, especially given the forest products industry’s “disappointing” financial record.