Stock Market Update

The stock market remains on track for a modestly higher opening following several economic data releases this morning.

Initial jobless claims for the week ending May 2 increased by 10,000 to 200,000 (Briefing.com consensus: 205,000), while continuing jobless claims for the week ending April 25 decreased by 10,000 to 1.766 million.

The key takeaway from the report is its quiet disposition in the sense that it isn't showing wide swings in either initial claims or continuing claims, which suggests some welcome steadiness in the labor market.

Separately, nonfarm business sector labor productivity increased 0.8% in the first quarter (Briefing.com consensus: 1.8%) following a downwardly revised 1.6% increase (from 1.8%) in the fourth quarter. Unit labor costs rose 2.3% (Briefing.com consensus: 2.7%) on the heels of an upwardly revised 4.6% increase (from 4.4%) in the fourth quarter.

The key takeaway from the report is that, while productivity undershot expectations, unit labor costs decelerated in a move that should placate inflation hawks at the Fed. That won't change the prevailing belief that the Fed isn't going to be cutting rates soon, but it will temper some of the budding fears about entertaining the idea of a rate hike.