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Jobless claims fall by 32,000 to 383,000

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Stock futures got a bit of a boost this morning after jobless claims for the week ending June 1 showed a decrease of 32,000 from the previous week's revised higher figure of 415,000, which has the weekly jobless claims falling to 383,000. This was well below the 405,000 level forecasted by economists.

The four-week moving average, which smoothes out week-to-week volatility, fell 8,500 to 411,250 from the previous week's revised average of 419,750. The four-week moving average has not been this low since the week ended March 23, when a level of 398,750 was recorded.

While initial jobless claims fell, continuing claims for the week ended May 25 increased by 29,000 to 3.8 million. The four-week moving average was 3.8 million, an increase of 12,250 from the previous week's revised average.

This morning's stock futures reaction looks to have been muted by the rising continuing claims number as more Americans remain without jobs.

Stock futures fractionally lower

S&P futures are currently trading down 0.6 points at 1,050.00. NASDAQ futures remain near the lows of the session, down 8.50 points at 1,185.50, while Dow futures trade unchanged at 9,805.

Fair value for the S&P 500 is $0.13. That price will not change during the session. HL Camp & Company has their computers set for program buying at $1.52 and set for selling at $-1.32. Fair value for the NASDAQ-100 today is $1.13.

Intel downgraded at Merrill

Partly responsible for the lack of pre-market bullishness in the NASDAQ futures is this morning's downgrade of Intel (NASDAQ:INTC). After a couple firms had positive comments earlier in the week ahead of tonight's mid-quarter update, shares of Intel (NASDAQ:INTC) $28.18 are trading down $0.83 (-2.9%) after Merrill Lynch downgraded the stock to "neutral" from "strong buy," telling clients the stock was "no bargain" on a price-to-earnings/growth basis.

Merrill also lowered its mid-term ratings on LLTC, SMTC, TXN and TQNT, saying "we believe that the early cycle semiconductor upturn has now played itself out."

Jeff Bailey
Senior Market Technician
Option Investor

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