The Labor Department reported today that 323,000 initial jobless claims were filed for the week ending March 1, a decline of 26,000 from the revised count of 349,000 for the previous week (which itself was up slightly from the 348,000 figure released last Thursday). The four-week moving average, a better indication of the health of the economy, dropped 2,000 down to 336,500. Furthermore, the analysts who compile the data said that no states had estimated for this reading and there were no special circumstances affecting the data. This is good news because it means that it is very unlikely that we will see a large revision to last week's claims number.
This data has investors feeling confident about the monthly Labor Department jobs report which is expected to be released tomorrow, which is one reason the major indexes are heading higher. As of 1:05 p.m. EST, the Dow Jones Industrial Average (DJINDICES:^DJI) is up 85 points, or 0.52%, the S&P 500 is higher by 0.40%, and the Nasdaq has risen 0.20%.
Outside the Dow, shares of Kroger (NYSE:KR) are trading higher by 0.2% this afternoon after the supermarket chain released its latest earnings report this morning. Quarterly revenue came in at $23.22 billion, higher than the $23.15 billion analysts were estimating, while earnings per share hit $0.78, also higher than Wall Street's projection of $0.72 per share. The company said the stronger than expected results were due to its ability to service the customer prior to and after the storms the U.S. has been hit with this winter. Properly managing inventory and supplies prior to a storm is key for the grocery. If the company didn't have a great handle on its process, it would have likely had empty shelves and missed out on lots of revenue and therefore profits. Shareholders should feel good about owning Kroger stock as management has once again proven its worth.
On the other side of the grocery/retail world, shares of Costco (NASDAQ:COST) are down 2.3% after the company reported second-quarter earnings that missed Wall Street's expectations. Costco's revenue jumped 6% during the quarter to hit $25.76 billion, while earnings per share came in at $1.05 per share -- much lower than the $1.24 the company posted last year. Analysts were expecting the company to post revenue of $26.65 billion and earnings of $1.17 per share. Still, analysts believe the Costco's issues are short term in nature and will pass. Sterne Agee analyst Charles Grom said Costco was dealing with seasonal softness, higher poultry costs, and a strong U.S. dollar, which all contribute to the weak quarter.
Shares of Internet radio company Pandora (NYSE:P) are off by more than 4%. The decline comes after the company released data on the number of hours its listeners recorded in February: 1.51 billion. That is 9% higher than what Pandora recorded last February, but a drop from the 1.58 billion hours reported for January. Investors have long been concerned about a slowing of listener hours as competition in the industry heats up with Apple's streaming radio service and Spotify. While this data plays into the hands of the bears, shareholders should not panic after one report. If we see a consistent decline over the next six months, then shareholders should reconsider their position.
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