If QE 3 is to buttress the economic expansion, it has come at a late hour, a few new
economic data points show. First, initial unemployment claims is a good weekly
leading indicator for the economy. The trend of improvement has clearly stalled out:
IUIC weekly chart. Claims are running 382K a week and to support a continuation of
the recent advance in stocks, claims are going to have to drop to and sustain the 360K
level in the months ahead.
Markit's PMI flash report for Sept. manufacturing shows the sector is bumping along at
minimally positive levels. Markit Flash Mfg. Scroll to page 2 and you will see a bright
spot, namely a slight increase in new orders for Sept. An acceleration of the rise in new
orders would be a positive for the stock market as well as for the economy.
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