Economic Signals Mixed as Jobless Claims Rise and PPI Eases

Pre-market futures are trending lower today, driven by a combination of rising weekly jobless claims, a better-than-expected Producer Price Index (PPI), and uncertainty surrounding the U.S.-China trade agreement announced by President Trump. The lack of clarity on the trade deal, paired with economic indicators, has contributed to market unease. Additionally, a tragic Boeing 787-8 Dreamliner crash in Ahmedabad, India, has sent Boeing shares tumbling by 7%, further weighing on the Dow, which is down 225 points. The S&P 500 is off by 25 points, the Nasdaq by 85 points, and the Russell 2000 by 15 points, retreating from recent weekly and monthly highs.

Weekly Jobless Claims remained elevated at 248,000, matching the prior week’s upwardly revised figure and slightly exceeding forecasts by 2,000. The four-week moving average rose to 240,000 from 231,000, indicating a gradual uptick in new claims. Continuing Claims hit 1.956 million, the third consecutive week above 1.9 million and the highest since mid-November 2021. This creeping rise towards 2 million weekly claims suggests a potential shift in the labour market narrative, with longer-term unemployment figures showing persistence despite previous downward revisions.

The May PPI report offered some relief, with headline month-over-month figures at +0.1%, below the anticipated +0.2% and up from April’s revised -0.2%. Core PPI, excluding food and energy, also came in at +0.1%, 20 basis points below expectations. Year-over-year, headline PPI reached +2.6%, slightly up from April’s +2.5%, while core PPI eased to +3.0% from a 12-month high of +3.9% in March. Although inflation remains above the Federal Reserve’s ideal range, these figures suggest it is stabilising. With tariff deadlines looming 27 days away, the economy continues to navigate a complex landscape.