(By Kevin Donovan) It's the first day of summer but signs of hibernation continue to proliferate. Initial claims for unemployment insurance did fall 2,000 to 387,000 in the week ended June 16, the U.S. Labor Department said. The four-week moving average, however, rose 3,500 to 382,750. Obviously, the job market remains soft.
Stock futures are slightly higher. Bonds are little changed. Oil and gold are lower.
The claims number is yet another straw in the wind telling us that the momentum in the economy seen last winter has stalled.
Yesterday, the Federal Reserve acknowledged the slowdown and lowered its expectations for output growth, but confined its policy actions to extending "Operation Twist."
Fed Chairman Ben Bernanke insisted yesterday the Fed is not out of ammunition, but the drip-drip-drip of soft economic numbers, particularly high-frequency statistics such as jobless claims, suggests something structural is afoot, not the cyclical winds the Fed is equipped to handle.