Filed claims for unemployment insurance payments dropped by 15,000 last week, showing the labor market is starting 2012 on better footing than a year earlier, reports Bloomberg.
"The average [number of claims] over the past four weeks declined to the lowest level in more than three years." Initial jobless claims reflect weekly firings and tend to fall as job growth rises.
Bloomberg attributes the decrease in firings to companies "getting more comfortable with their headcounts and their economic outlooks as the year begins."
Furthermore, data shows companies added 325,000 workers in December, more than forecast.
Indeed, along with other positive data that include an increase in consumer spending, this is a good statistic to start off the year, and an indication that U.S. markets are heading in the right direction.
The shady side of unemployment data
Unemployed citizens who have used up their traditional benefits and now collecting emergency and extended payments increased by about 5,400 to 3.5 million in the week ended Dec. 17. (via Bloomberg)
In addition, December data may be skewed by the "purge effect." This is when workers who have been dismissed or quit throughout the year, sometimes remain on company records until December. When the records are updated at the end of the year and reported to ADP, we may find the unemployment data is a bit off.
Business section: Investing ideas
If the economy rebounds stronger than expected, which stocks stand to benefit?
For ideas, we collected data on institutional money flows and identified rallying S&P 500 stocks that have seen significant institutional buying during the last three months. All of these stocks are trading above their 20-day, 50-day, and 200-day moving averages.
Big money managers have extensive resources to analyze investing ideas. So if they're buying a certain stock, it's worth paying close attention.
Do you agree with this bullish sentiment? Use this list as a starting point for your own analysis.
List sorted by distance from 200-day simple moving average (SMA). (Click here to access free, interactive tools to analyze these ideas.)
2. Williams Companies
3. Public Storage: Operates as a real estate investment trust (REIT). The stock is currently trading 1.45% above the 50-day SMA, 4.17% above the 50-day SMA, and 13.39% above the 200-day SMA. Net institutional purchases in the current quarter at 5.6M shares, which represents about 3.94% of the company's float of 142.09M shares.
4. Whole Foods Market
5. HCP: HCP, is an independent hybrid real estate investment trust. The stock is currently trading 1.83% above the 50-day SMA, 4.74% above the 50-day SMA, and 11.18% above the 200-day SMA. Net institutional purchases in the current quarter at 24.4M shares, which represents about 6.02% of the company's float of 405.17M shares.
6. Simon Property Group
7. Ecolab: Develops and markets products and services for the hospitality, foodservice, health care, and industrial markets primarily in the United States. The stock is currently trading 3.53% above the 50-day SMA, 5.16% above the 50-day SMA, and 10.69% above the 200-day SMA. Net institutional purchases in the current quarter at 16.7M shares, which represents about 7.93% of the company's float of 210.51M shares.
8. Health Care REIT
9. Ventas: Engages in investment, management, financing, and leasing of properties in the health care industry. The stock is currently trading 0.93% above the 50-day SMA, 2.32% above the 50-day SMA, and 4.07% above the 200-day SMA. Net institutional purchases in the current quarter at 10.2M shares, which represents about 3.57% of the company's float of 286.06M shares.
10. Avalonbay Communities: Engages in the development, redevelopment, acquisition, ownership, and operation of multifamily communities in the United States. The stock is currently trading 2.01% above the 50-day SMA, 3.04% above the 50-day SMA, and 3.70% above the 200-day SMA. Net institutional purchases in the current quarter at 8.0M shares, which represents about 8.49% of the company's float of 94.24M shares.
Interactive Chart: Press Play to compare changes in analyst ratings over the last two years for the stocks mentioned above. Analyst ratings sourced from Zacks Investment Research.
List compiled by Eben Esterhuizen, CFA. Kapitall's Eben Esterhuizen and Rebecca Lipman do not own any of the shares mentioned above. Institutional data sourced from Fidelity, all other data sourced from Yahoo! Finance.
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