LIVE MARKETS-Thursday data: Jobless claims, Philly Fed, leading economic index

Welcome to the home for real-time coverage of markets brought to you by Reuters reporters. You can share your thoughts with us at markets.research@thomsonreuters.com

THURSDAY DATA: JOBLESS CLAIMS, PHILLY FED, LEADING ECONOMIC INDEX

Data on Thursday offered mostly blue skies with a cloud or two lurking on the horizon.

Last week, 219,000 U.S. workers joined the queue outside the unemployment office USJOB=ECI, according to the Labor Department.

That's a weekly increase of 5,000, and 1.9% above the 215,000 consensus.

The data is provided by the states and therefore does not include the thousands of federal government employees who have been fired by Elon Musk's Department of Government Efficiency (DOGE) in recent weeks.

"Aside from federal job cuts, most data suggests that the labor economy remains relatively stable, with private sector employers still hiring at a decent clip," writes Jim Baird, chief investment officer at Plante Moran Financial Advisors.

"Looking ahead, the composition of claims data will come into greater focus," Baird adds. "A surge in former federal employees is expected."

Ongoing claims USJOBN=ECI, reported on a one-week lag, bumped up by 1.3% to 1.869 million, echoing recent consumer survey data which suggests jobs are becoming harder to find.

Turning to the manufacturing sector, Atlantic region factory activity continued to expand this month, but at a decelerated pace.

The Philadelphia Federal Reserve's Business index (or, Philly Fed) USPFDB=ECI landed at 18.1, or 26.2 points below January's spike and just a bit weaker than the reading of 20 that analysts expected.

While the index retraced part of that January spike, "it remains in very strong territory," says Carl Weinberg, chief economist at High Frequency Economics. "Manufacturing may be slumping in the nation as a whole, but it is booming in Philly, according to this index."

This report, combined with Tuesday's Empire State data, suggests manufacturing in the Northeast is finding its footing.

A Philly Fed/Empire State number in positive territory indicates a monthly expansion of activity.

Finally, the Conference Board's (CB) Leading Economic index (LEI) USLEAD=ECI posted a 0.3% decline in January, all but erasing the prior two month's gains - the first gains since February 2022.

The index is an amalgamation of ten forward-looking economic indicators, including initial jobless claims, ISM new orders, building permits, yield spreads and S&P 500 price performance, among others.

"Consumers' assessments of future business conditions turned more pessimistic in January, which—alongside fewer weekly hours worked in manufacturing—drove the monthly decline," says Justyna Zabinska-La Monica, CB's senior manager of Business Cycle Indicators.

"However, manufacturing orders have almost stabilized after weighing heavily on the Index since 2022, and the yield spread contributed positively for the first time since November 2022."

The graphic below charts the LEI against the S&P 500, one of its constituents. While they historically tend to move in concert, that relationship began to diverge in late 2022, proving once again that the economy and the stock market are two different things.

(Stephen Culp)

*****

FOR THURSDAY'S EARLIER LIVE MARKETS POSTS:

NAVIGATING THE MARKET MAZE: S&P 500, TRUMP POLICIES AND MAG 7 - CLICK HERE

US INDEXES FALL EARLY AS WALMART FORECAST DISAPPOINTS - CLICK HERE

TECH VS FINANCIALS: THIS DOGFIGHT IS GETTING INTERESTING - CLICK HERE

UBS EXPECTS BOE TO DELIVER ONLY THREE RATE CUTS THIS YEAR AFTER DATA - CLICK HERE

CHINA STOCKS HAVE MORE ROOM TO RUN, SAYS MORGAN STANLEY - CLICK HERE

IS THE RALLY IN CEMENT STOCKS BUILT ON SHAKY FOUNDATIONS? - CLICK HERE

GERMAN DEBT BRAKE: DON'T FORGET THE ESCAPE CLAUSE - CLICK HERE

EUROPEAN SHARES MIXED, DEFENCE STOCKS TAKE A BREATHER - CLICK HERE

EUROPE BEFORE THE BELL: UKRAINE, TARIFFS, EARNINGS IN FOCUS AS FUTURES INCH UP - CLICK HERE

GOLD AND YEN BASK IN THE LIMELIGHT - CLICK HERE