Jobless Claims : Will History Repeats Itself ?
One Week Ago.
It was exactly a week ago, on Thu, 01 Aug 2024 when US weekly jobless claims report (for week ending 27 Jul 2024) was released, that started the whole downward spiral.
US Weekly Jobless Claims.
The Labor Department reported:
Number of people on jobless rolls swelling in mid-July to the highest level since late August 2021.
Initial claims for state unemployment benefits increased +14,000 to a seasonally adjusted 249,000.
Economists polled by Reuters had forecasted 236,000 claims instead.
The data fanned fears of a rapid labour market deterioration, that first surfaced in July 2024, when data showed the unemployment rate rose to a 2-1/2-year high of 4.1% in June.
S&P 500 Since 01 August.
Ever since last Thursday, the $S&P 500(.SPX)$ index has not stop trending downwards. (see above)
On 01 Aug 2024, the index closed at 5,446.68.
On 07 Aug 2024, the index closed lower at 5,199.50, losing -4.54%.
One Week Later.
On the eve of another weekly jobless claims report to be released - below is Wall Street’s forecast for week ending 03 Aug 2024.
Forecast.
Consensus is for a decline from the 249,000 initial jobless claims to 240,000 over the 7-day stretch. (see above)
According to Citigroup's head of US equity trading strategy, Stuart Kaiser — the options market is implying the S&P 500 Index will move 1.2% in either direction on Thursday.
Implying Thursday volatility will be roughly be in line with the elevated levels currently expected surrounding some of August's biggest macro events. (see below)
This includes:
14 Aug 2024 - when (once again) the Consumer Price Index (CPI) inflation report will be out.
22-24 Aug 2024 - Fed Chair Jerome Powell's speech at the Annual central banking conference at Jackson Hole, Wyoming.
28 Aug 2024 - when $NVIDIA Corp(NVDA)$, the last Magnificent Seven company, will report its Q2 2024 earnings.
Remember to mark down these dates on your calendar as US market will likely becomes “nervous” on the run up to the economic data report and quarterly earnings releases.
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Do you think US Weekly Jobless claims will cool and ease off slightly 7 days later ?
Do you think the Inflation Report and Nvidia will be able to inject confidence back in the market ?
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