US DATA: Continuing Claims Continue To Rise, Suggesting Soft Hiring
MNI estimates a small rise in continuing jobless claims in the Oct 18 week, to an estimated ~1,950k, from 1,938k prior.
- Our estimates may slightly understate the level of continuing claims very slightly vs the official series as we don't have all official data to make the calculation, and we make the usual caveat that there has been a consistent trend of downward revisions.
- But the direction is fairly clear and suggests the 4th or 5th consecutive weekly rise since the recent bottom of 1,909k in mid-September. (The pickup in non-seasonally adjusted continuing claims is also running a little hotter than the typical trend if our estimates are right).
- As such if our estimates are correct it's beginning to look like continuing claims are nearing the recent cyclical high in the 1,960ks set in June and July - which of course coincided with a notable slowdown in nonfarm payrolls growth in May-Aug.
- Combined with initial claims remaining fairly stable, it's suggestive overall of a low hiring, and low-firing labor market.
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OIL: US Crude Drawdown But Product Inventories Higher
Bloomberg reported a US crude stock drawdown of 3.7mn last week with 693k at Cushing, according to people familiar with the API data. However, gasoline rose 1.3mn and distillate 3.0mn. Inventory data is being monitored for signs of excess supply as the IEA is forecasting a record market surplus in 2026. The official EIA data is due to be released on Wednesday, which if it follows the industry data will show a third consecutive weekly inventory drop.
USDCAD TECHS: Bull Cycle Remains In Play
- RES 4: 1.4111 High Apr 10
- RES 3: 1.4019 38.2% retracement of the Feb 3 - Jun 16 bear leg
- RES 2: 1.3968 High May 20
- RES 1: 1.3959 High Sep 26
- PRICE: 1.3929 @ 16:41 BST Sep 30
- SUP 1: 1.3885/3810 Low Sep 25 / 50-day EMA
- SUP 2: 1.3727 Low Aug 29 and a bear trigger
- SUP 3: 1.3689 Low Jul 28
- SUP 4: 1.3637 Low Jul 25
A bullish theme in USDCAD remains intact and the pair is holding on to the bulk of its latest gains. Recent gains have resulted in the breach of a key resistance at 1.3925, the May 20 high and bull trigger. The break confirms a resumption of the bull cycle that started Jun 16. This paves the way for a climb towards 1.4019, a Fibonacci retracement point. On the downside, first key support lies at 1.3810, the 50-day EMA.
US STOCKS: Late Equity Index Rebound
Stocks actually stage late session recovery - as focus turns toward fundamentals instead of political turmoil:
- DJIA up 87.76 points (0.19%) at 46284.74
- S&P E-Mini Future up 27 points (0.4%) at 6719.5
- Nasdaq up 61.3 points (0.3%) at 22588.13
