Jobless Claims Down To 210K

…And the Initial Jobless Claims just keep falling. Last week, a downwardly revised 220K was the lowest weekly figure we’d seen since the early ’70s; today we see that number fall by another 10K claims to 210K — the lowest since the Beatles were still together (and the labor market looked much, much different than it does today). Continuing claims rose a bit to 1.93 million, but this remains historically low.

We also see other economic metrics hit the tape this morning, including Personal Income and Consumer Spending numbers. Income matched expectations as well as the previous month’s read of +0.4%, while Spending was also in-line with consensus at +0.2%, down from 0.4% in last month’s report. Importantly, wages grew 0.5% — a clue that inflation is finally making its way into our present economy.

Under even closer consideration by the Fed in deciding interest rate policy going forward, January Personal Consumption Expenditures, aka the PCE deflator, rose 0.4% to stand at 1.7% year over year. This would indicate that inflation is far from at risk of overheating, at least at this time. The Fed will look for spikes in the PCE deflator in the coming months, especially once the monumental tax cut works its way through the economy.

Speaking of the Fed, Chairman Jay Powell testified to Congress this week that the overall economy looks good. Somewhat paradoxically, this vote of economic encouragement spooked market participants on Wednesday, sending marginally positive indexes plummeting once again, on fears that an increased number of interest rates may be forthcoming this year.

There is nothing in Powell’s testimony that justifies a terror-stricken market. Just read Zacks Exec VP Kevin Matras’ hot take on this from earlier this morning: How to Appreciate Temporary Pullbacks in a Bull Market. We may instead chalk this up to a teachable moment for a rookie Fed Chair, in that every syllable uttered on the state of the economy can be expected to be scrutinized deeply. (Recall a very similar thing happened when Ben Bernanke took over for Alan Greenspan 12 years ago.)

Powell gets another chance today when he testifies before the Senate Banking Committee this morning. Market participants also get another chance to grow more comfortable with the new Chair’s rhetoric. In any case, we don’t expect the sky to fall in the U.S. economy any time soon, so any further market hysteria to the downside may be an excellent opportunity to pick up great stocks at even better prices: Zacks Rank #1 (Strong Buy) List.