INITIAL CLAIMS: FORD DRIVES CLAIMS LOWER

Claims Strength Attributable to Ford Not Idling Plants - A Healthy Sign

This morning's jobless claims number was better than expected primarily because of a decision by Ford to idle 13 plants for just one week this summer instead of two. Factory workers are allowed to collect unemployment insurance during these idling periods. As the chart below shows, weeks 27 and 28 normally reflect large increases in NSA claims while the plants are closed. This reverses in weeks 29 and 30 as the plant resume production. The average WoW rise in NSA claims in the comparable week over the last five years has been 42k compared to the decline in NSA claims of 3k in this morning's print. 

 

Initial jobless claims fell 12k last week to 374k. Incorporating the 2k upward revision to the prior week's data, claims fell 14k. Rolling claims fell 1.5k WoW to 386k. On a non-seasonally adjusted basis, claims fell 3k. NSA rolling claims are improving at a rate of ~7% YoY, which is a further decline in the rate of YoY improvement - a worrisome sign. 

 

INITIAL CLAIMS: FORD DRIVES CLAIMS LOWER - Auto3

 

INITIAL CLAIMS: FORD DRIVES CLAIMS LOWER - Raw

 

INITIAL CLAIMS: FORD DRIVES CLAIMS LOWER - Rolling

 

INITIAL CLAIMS: FORD DRIVES CLAIMS LOWER - NSA

 

INITIAL CLAIMS: FORD DRIVES CLAIMS LOWER - NSA rolling

 

INITIAL CLAIMS: FORD DRIVES CLAIMS LOWER - S P

 

INITIAL CLAIMS: FORD DRIVES CLAIMS LOWER - Fed

 

INITIAL CLAIMS: FORD DRIVES CLAIMS LOWER - YoY NSA

 

The 2-10 Spread

The 2-10 spread widened 1 bp WoW to 132 bps, while the ten-year treasury yield rose 1 bp to 163 bps. 

 

INITIAL CLAIMS: FORD DRIVES CLAIMS LOWER - 2 10

 

INITIAL CLAIMS: FORD DRIVES CLAIMS LOWER - 2 10 QoQ

 

Financial Subsector Performance

The table below shows the stock performance of each Financial subsector over four durations. 

 

INITIAL CLAIMS: FORD DRIVES CLAIMS LOWER - Subsector Monitor

 

INITIAL CLAIMS: FORD DRIVES CLAIMS LOWER - Companies

 

Joshua Steiner, CFA

 

Robert Belsky

 

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