Takeaway: The labor market finished strong in April. The sum of initial claims came in at the lowest level since 1996 and is almost tied with 2000.

Editor's Note: Below is an excerpt from a detailed breakdown of this morning's initial claims data from Josh Steiner and the Hedgeye Financials team. If you're an institutional investor and would like to setup a call with Josh or Jonathan Casteleyn or trial their research, please contact sales@hedgeye.com



April finished just as strong as it started. As we have pointed out in the last few weeks and show in the first chart below, in terms of cumulative initial claims April 2015 has been the best April since 1996 with the small exception of 2000 (with which it's almost tied). We now look to the jobs report on Friday to see if claims strength with show up in the overall employment situation.


One thing to note about tomorrow's NFP report is that it will have 5 weeks in it vs the normal 4. The BLS corrects for this, but in years when an April with 5 weeks follows years with a 4-week April data problems have tended to ensue. Remember that the establishment survey measures from the weeks of the 12th to the 12th. As such, it's possible that there will be an upward bias to tomorrow's number on the order of ~25% owing to the inclusion of the additional week. We continue to rely on claims as our primary indicator of the Labor market's health.


In the second chart below, oil prices have made steady progress upward of late. Given that movement, the spread between the indexed basket of claims in energy-heavy states and the U.S. as a whole tightened week over week from 28.1 to 26.6.






The Data

Initial jobless claims rose 3k to 265k from 262k WoW, as the prior week's number was unrevised. Meanwhile, the 4-week rolling average of seasonally-adjusted claims fell -4.25k WoW to 279.5k.


The 4-week rolling average of NSA claims, another way of evaluating the data, was -10.8% lower YoY, which is a sequential deterioration versus the previous week's YoY change of -11.6%





Another French Revolution?

"Don't be complacent," writes Hedgeye Managing Director Neil Howe. "Tectonic shifts are underway in France. Is there the prospect of the new Sixth Republic? C'est vraiment possible."

read more

Cartoon of the Day: The Trend is Your Friend

"All of the key trending macro data suggests the U.S. economy is accelerating," Hedgeye CEO Keith McCullough says.

read more

A Sneak Peek At Hedgeye's 2017 GDP Estimates

Here's an inside look at our GDP estimates versus Wall Street consensus.

read more

Cartoon of the Day: Green Thumb

So far, 64 of 498 companies in the S&P 500 have reported aggregate sales and earnings growth of 6.1% and 16.8% respectively.

read more

Europe's Battles Against Apple, Google, Innovation & Jobs

"“I am very concerned the E.U. maintains a battle against the American giants while doing everything possible to sustain so-called national champions," writes economist Daniel Lacalle. "Attacking innovation doesn’t create jobs.”

read more

An Open Letter to Pandora Management...

"Please stop leaking information to the press," writes Hedgeye Internet & Media analyst Hesham Shaaban. "You are getting in your own way, and blowing up your shareholders in the process."

read more

A 'Toxic Cocktail' Brewing for A Best Idea Short

The first quarter earnings pre-announcement today is not the end of the story for Mednax (MD). Rising labor costs and slowing volume is a toxic cocktail...

read more

Energy Stocks: Time to Buy? Here's What You Need to Know

If you're heavily-invested in Energy stocks it's been a heck of a year. Energy is the worst-performing sector in the S&P 500 year-to-date and value investors are now hunting for bargains in the oil patch. Before you buy, here's what you need to know.

read more

McCullough: ‘My 1-Minute Summary of My Institutional Meetings in NYC Yesterday’

What are even some of the smartest investors in the world missing right now?

read more

Cartoon of the Day: Political Portfolio Positioning

Leave your politics out of your portfolio.

read more

Jim Rickards Answers the Hedgeye 21

Bestselling author Jim Rickards says if he could be any animal he’d be a T-Rex. He also loves bonds and hates equities. Check out all of his answers to the Hedgeye 21.

read more