- Jobless claims drop, but on seasonal factors
- US GDP revised higher for Q3 due to inventory build-up
- Apple lifts Nasdaq on China Mobile speculation
Dow Jones: -0.02%
S&P 500: -0.08%
Upbeat economic data on Thursday was met with a subdued reaction on Wall Street with benchmarks mixed on fears that a stronger economy may not require the current level of asset purchases by the Federal Reserve.
A sharp drop in jobless claims and an upwards revision to third-quarter US economic growth increased bets that the central bank could begin to scale back stimulus as soon as this month amid signs of an accelerating recovery.
"With little left on the data calendar from this afternoon, investors will have to chew over possible Fed reaction until the next clue comes along[...]cue non-farm payrolls," said Toby Morris, Senior Sales Trader at CMC Markets.
The official jobs report - likely to be a key factor in the Fed's policy decision at its meeting on December 17-18th - is due out on Friday afternoon and is expected to reveal a 183,000 increase in non-farm payrolls for November, below the 204,000 gain in October.
Economic data in focus ahead of Fed decision
Initial weekly jobless claims fell to 298,000 in the week ended November 30th, compared with a total of 321,000 the previous week and well below the consensus forecast for a reading 320,000.
However, the Labor Department did note that seasonal factors could have affected the data, such as the timing of the Thanksgiving holidays.
US gross domestic product growth expanded at an annual pace of 3.6% in the third quarter, the strongest growth registered in a year and a half. This was revised up from the initial 2.8% estimate and well ahead of the 2.5% expansion in the second quarter.
However, analysts were divided over the data given that the upwards revision was directly as a result of inventory accumulation during the period, which is now likely to be a drag on growth in the fourth quarter.
"This balance of growth - with very strong inventory accumulation but mediocre domestic demand growth - is unlikely to persuade policymakers that the economy is on a significantly firmer footing," said analyst Peter Newland from Barclays Research.
Meanwhile, factory orders declined by 0.9% in October, pulling back after a 1.8% gain in September, but better than the 1% fall expected by analysts.
Apple up on China Mobile hopes
Tech giant Apple was making gains today on reports that China Mobile could be offering the company's popular iPhones on its network.
Teen clothing retailer Aeropostale slumped after losses widened in the third quarter and the firm forecast a worse-than-expected loss for the all-important fourth quarter.
Discount chain Dollar General rose after lifting its earnings guidance for the full year, while grocer Safeway fell after Jana Partners trimmed its stake in the firm.