Fall Of Jobless Claims Raises Recovery Hopes

The weather is good in the U.S. labor market.

The number of Americans who sought unemployment fell more than expected last week. This is a welcome sign of improvement in the U.S. economy and that the recovery may be on the horizon. The initial jobless claims fell by 38,000 to a seasonally adjusted figure of 550,000 in the week ending August 1, from a revised figure of 588,000 in the week prior.

The unemployment data was significantly better than expected by the market. Experts had anticipated that this number will be in the range of 580000.

As a contrast, the number of people who stood to receive unemployment benefits increased by 69,000 to a total of 6.31 million in the week ending July 25.

Such requests had fallen continuously in the last three weeks. It is expected that in coming months the U.S. economy and the unemployment will keep the downward trend as the recovery gains speed in different sectors of the economy.

In Wall Street looks like the investors did not cheer the good news about initial jobless claims. The day started positively in the world's main stock exchange, but as the minutes passed the investors pushed the stocks into red. Volatility in Wall Street turned an encouraging opening session to become something like without a precise direction in which the S&P 500 is struggling to maintain the 1000 points level.

Written by Armen Hareyan