Thursday, 7/2/09 10:25 AM edt
At 10:25 the DJIA -187; 10 yr note +12/32 3.50%, mortgage prices +6/32.
June unemployment rate hit at 9.5% +0.1% frm May but -0.1% against the estimates at 9.6%. Non-farm payrolls were expected at -363K but were down 467K, yesterday's ADP estimate was -473K (ADP is becoming more relevant than in the past). The chatter on the unemployment rate given it is increasing at a slower pace than earlier this year is that the rate of unemployment is slowing---a good thing. Not in my reasoning. Job losses at 450K+ a month is hard to argue that it is a good thing; the increase in the unemployment rate is increasing every month, not good. The Street and analysts and pundits that make their pay by selling investments can paint a Picasso with a spray gun on any data. Bottom line, this data this morning can't be legitimately twisted as a good report because unemployment only increased by 0.1%. 15 mil people are out of work, 47% for over 6 months.
Also tucked somewhat behind the June employment report; weekly jobless claims were also released. Claims were expected to be down about 8K from last week. As reported, claims fell 13K from last week to 614K. Somewhat better, continuing claims did decline a little to 6.70 mil from 6.755 mil last week, but we can't hang much on that tree given the decline of jobs in June.
At 10:00 May factory orders, expected to be up 1.4%, was up 1.2%; ex transportation orders +0.8%. April factory orders revised to +0.5% frm +0.7%, ex transportation in April revised from +0.1% to -0.2% The May increase in orders was the best increase since June 2008. No real reaction to the data with total focus today on the employment situation.