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Jobless Thursday (With Inflation, Manufacturing Kickers)

Three helpings of bad news this morning, so let's get to it.

Initial jobless claims jumped from an (inevitably) upward revised 417,000 to 428,000, confounding doggedly optimistic economists who expected to see a drop to 410,000.  The pattern of weekly revisions is now so well established that we can confidently chuck that 428,000 figure and assume it'll settle at 431,000 or 432,000 next week.

The preliminary number puts filings at their highest level since the end of June.  But if we find it revised to 432,000, you have to go back to early May to find a worse week.

Retail inflation also came in hotter than expected, with prices rising 0.4% in august, double expectations of 0.2%.  Core inflation rose 0.2%, in line with expectations.  This contradicts yesterday's wholesale inflation data, showing prices roughly flat for the month, in line with or slightly cooler than the consensus.

The Empire State Manufacturing Survey from the New York Fed saw conditions deteriorate for the fourth consecutive month, dipping from -7.7 to -8.8.  Economists were expecting some improvement to -4.0.

Stock futures initially gave up some of their gains on the news, but recovered after the Fed's Industrial Production report showed activity growing at 0.2% in August (compared with expectations of 0.0%).  In early trading, major indexes were all about 1% higher, trading mainly on optimism about European debt crises.

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Jobless Thursday (With Inflation, Manufacturing Kickers)

Three helpings of bad news this morning, so let's get to it.

Initial jobless claims jumped from an (inevitably) upward revised 417,000 to 428,000, confounding doggedly optimistic economists who expected to see a drop to 410,000.  The pattern of weekly revisions is now so well established that we can confidently chuck that 428,000 figure and assume it'll settle at 431,000 or 432,000 next week.

The preliminary number puts filings at their highest level since the end of June.  But if we find it revised to 432,000, you have to go back to early May to find a worse week.

Retail inflation also came in hotter than expected, with prices rising 0.4% in august, double expectations of 0.2%.  Core inflation rose 0.2%, in line with expectations.  This contradicts yesterday's wholesale inflation data, showing prices roughly flat for the month, in line with or slightly cooler than the consensus.

The Empire State Manufacturing Survey from the New York Fed saw conditions deteriorate for the fourth consecutive month, dipping from -7.7 to -8.8.  Economists were expecting some improvement to -4.0.

Stock futures initially gave up some of their gains on the news, but recovered after the Fed's Industrial Production report showed activity growing at 0.2% in August (compared with expectations of 0.0%).  In early trading, major indexes were all about 1% higher, trading mainly on optimism about European debt crises.