Jobless Claims Data Shows Improving Market; Student Loans Reach Record; Stocks Drop
The labor market continues to prove its resiliency as the number of Americans filing claims for unemployment benefits fell more than expected last week. More specifically, last week’s claims data on nonfarm payrolls for May dropped 15,000 between the April and May survey periods, which suggests steady gains in employment for this month.”The recently lower initial claims readings have continued to suggest improvement on the layoff side of the labor market equation and should prove marginally positive for the May nonfarm payroll report,” said Gennadiy Goldberg, U.S. strategist at TD Securities in New York.
Overdue student loans have been catching up to college graduates, which have hit an all-time high, according to a government report released today. The U.S. Education Department also notes that eleven percent of student loans were seriously delinquent in the third quarter of 2012, and almost 30 percent of 20 to 24-year-olds aren’t employed or in school. Borrowers have been indicating that the burden is affecting their choice of jobs and their ability to buy homes and get married. “Today’s economy puts young graduates in a difficult position,” Jack Buckley, commissioner of the National Center for Education Statistics, which published the report, said in a statement. “A college diploma no longer guarantees a direct pathway to the middle class, making it harder to justify the expense of a degree.”
Stocks fell today, giving benchmark indices their first back-to-back drops in a month, as a contraction in Chinese manufacturing offset American housing data and investors weighed the Federal Reserve’s stimulus comments. “The market is struggling with conflicting language from Fed officials as to the timing of potential tapering of asset purchases, slowing growth in China and after Japan’s decline in equities,” Ryan Larson, the Chicago-based head of U.S. equity trading at RBC Global Asset Management (U.S.) Inc., said in an interview.