This morning’s release of initial jobless claims marked the first time that claims were below 1 million since the week ending March 13th (21 weeks).  Jobless claims fell 228K to 963K compared to expectations of a much smaller drop to only 1.1 million from 1.19 million last week.  This week’s 228K decline was a slightly smaller drop than the prior week’s 244K decline but remains a much larger improvement than what was observed through most of June and July. Overall, claims are certainly on the right track with the first sub-1 million milestone now in the bag, but the 963K initial claims filed in the past week is still a historically elevated level higher than anything observed prior to the pandemic.

On a non-seasonally adjusted basis, this was actually the second week that claims were below 1 million with last week’s reading of 988.3K and this week’s 831.9K.  This decline comes with the seasonal tailwind that claims typically decline from early July through September.

Continuing claims are echoing the continued improvements in labor data with another decline of 604K this week bringing the seasonally adjusted number to 15.486 million. That leaves continuing claims at the lowest level since the first week of April.  Again, as is the case with initial claims, continuing claims remain historically high but are headed in the right direction.

Not only is the headline number of claims improving but so are claims for Pandemic Unemployment Assistance (PUA).  Initial claims by this measure fell from 0.66 million to 0.49 million this week. These are some of the lowest readings since the program began in mid-April. That brings the total between NSA claims and PUA claims to 1.32 million. While lagged an additional week, continuing claims for the week ending July 24 (26.6 million) were the lowest since April 24th, and for PUA claims in particular, it was the lowest reading since the end of May. Start a two-week free trial to Bespoke Institutional to access our interactive economic indicators monitor and much more.

Today marked 100 trading days since the Nasdaq 100’s March 20th COVID Crash closing low.  Below is a chart showing the rolling 100-trading day percentage change of the Nasdaq 100 since 1985.  The 59.8% gain over the last 100 trading days ranks as the 3rd strongest run on record.  The only two stronger 100-day rallies ended in January 1999 and March 2000.

While the Nasdaq 100 bottomed on Friday, March 20th, the S&P 500 bottomed the following Monday (3/23).  This means tomorrow will mark 100 trading days since the S&P 500’s COVID Crash closing low.  Right now the rolling 100-day percentage change for the S&P 500 sits at +46.7%.  But if the S&P manages to trade at current levels tomorrow, the 100-day gain will jump above 50%.  It has been 87 years (1933) since we’ve seen a 100-day gain of more than 50%!  Click here to view Bespoke’s premium membership options for our best research available.

Friday is just about everyone’s favorite day of the week, but for both the entire year and since March 23rd, the best days for the S&P 500 have been Monday and Wednesday.  On a YTD basis, the S&P 500’s median gain on Mondays has been 0.70% while Wednesday’s median gain has been 0.50%.  Outside of those two days, Tuesdays and Thursdays have been modestly positive, while Friday is the only day of the week that has seen declines on a median basis.

Looking just at the period since 3/23, Mondays and Wednesdays have still been the strongest with median gains of 0.73% and 0.71%, respectively.  Behind those two weekdays, Fridays have seen improved performance with a median gain of 0.34% followed by Tuesday (0.17%) and Thursday (0.00%).  What’s notable about the nearly five months since the 3/23 low is that every day of the week has seen gains on a median basis.

In terms of consistency, Mondays have been the most positive day of the week both on a YTD basis and since the March lows.  Since the March low, Wednesday and Friday have both seen gains two-thirds of the time, and while Monday through Thursday have seen similar levels of consistency whether you look on a YTD basis or since the March lows, Friday has had a pretty wide disparity.  In the period from late January through late March, investors did little in the way of buying on ‘Corona Fridays’ ahead of the weekend, but once the initial panic of the outbreak began to subside in April, that sentiment started to fade. Click here to view Bespoke’s premium membership options for our best research available.

After two months of some of the largest gains to small business confidence on record, NFIB’s Small Business Optimism index pulled back slightly in July. The index fell 1.8 points to 98.8 which was also below expectations of a reading of 100.5. While lower sequentially and still well off the highs from prior to the pandemic, July’s level of 98.8 was less than half a point from the historic average for small business optimism of 98.4.

Overall, breadth was very mixed in the July report.  Of the ten components of the headline index, four fell, one was unchanged and the other five rose.  As the pandemic drags on, the most glaring decline weighing on the headline number was for expectations of improvements in the economy.  Fewer companies reported now as a good time to expand (that index fell to 11 from 13 in June) and a net percentage of 25% expect the economy to improve compared to 39% in June.  The 14 point decline is tied with an identical decline in August of 2011 for the seventh-largest MoM decline on record for that index, but it only leaves that component in the 81st percentile of all readings. In other words, small businesses are less optimistic for the future than they were in June, but on net are still expecting the economy to improve.  That can be seen through hiring plans as a higher share plan to increase employment and increase capital expenditures with those indices rising 2 points and 4 points, respectively. On the other hand, fewer businesses plan to increase inventories as those expecting higher sales remains muted albeit improving. That can also be seen through the 3 point rise in the index for actual earnings changes. Fewer businesses were also reporting weak sales as the most pressing issue for business.

Additionally, although they are not inputs to the headline index, a record low of 26 percent reported borrowing on a regular basis, though, the cause of that does not appear to be due to credit availability. The index for credit availability was slightly higher in July and remains in the top 5% of all readings. The most important issues echo this as only 1% reported financials and interest rates to be the biggest issue; unchanged from last month.  The biggest issue for businesses remains the quality of labor. That index rose from 19 in June to 21 in July.  Click here to view Bespoke’s premium membership options for our best research available.