The number of Americans filing new claims for unemployment aid edged up last week for a third straight week, but the underlying trend continued to point to solid momentum in the labor market. Still, the rise in jobless claims and other data on Thursday showing weak new home sales in March and factory activity this month could heighten concerns about the economy’s ability to rebound strongly after stumbling at the start of the year.
Growth braked sharply as the economy was slammed by harsh winter weather, weak global demand and a now-settled labor dispute at West Coast ports. Activity also was constrained by a strong dollar as well as lower energy prices, which cut into domestic oil production. Initial claims for state unemployment benefits increased 1,000 to a seasonally adjusted 295,000 for the week ended April 18, the Labor Department said. Despite the increase, claims remained for a seventh consecutive week below the 300,000 threshold, a level associated with a strengthening labor market.
“Overall, the level of claims remains low and is consistent with a healthy labor market,” said Michael Feroli, an economist at JPMorgan in New York. Stocks on Wall Street were trading higher as a rise in crude oil prices offset disappointing quarterly results from a handful of large companies including Procter & Gamble Co (PG.N), which reported a steeper-than-expected drop in sales.