Wall Street Cheers Shopping and Jobless Claims Results

Posted by Louis Navellier on 6/5/08 10:43 am

U.S. stocks got a big boost today when several retailers announced solid same-store sales results for May.  Most of the strength was at the discounter and bulk chains, specifically Wal-Mart and Costco.  Moreover, a significant amount of the sales were concentrated in food and gasoline.  In fact, many shoppers bought food in bulk.

“The continued focus on necessities highlights the underlying weakness in consumer fundamentals,” said Scott Hoyt at Economy.com.

Nonetheless, the results indicate the tax-rebate checks are being spent instead of saved.  That’s a good sign for the economy.  Today’s jobless claims were good news, too.

Jobless claims fell by 18K to 357K for the week ending 5/31.  The result was well below the 375K consensus and the lowest since mid-April.  But seasonal distortions from the Memorial Day holiday could have contaminated the data.  Never mind that, though.  Tomorrow’s May employment report will decide whether today’s rally has staying power.

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