Jobless claims fall as plants put off retooling

WASHINGTON, Thu Jul 12, 2012 – The number of Americans lining up for jobless benefits last week fell to a four-year low, a hopeful sign for the struggling labor market although some of the improvement may be temporary, government data showed on Thursday.
A separate report showed import prices falling sharply in June, fresh evidence of a cooling global economy but also a reminder that a drop in gasoline prices could help U.S. consumers.
The Labor Department said new claims for state unemployment benefits dropped 26,000 to a seasonally adjusted 350,000.
The drop, which brought new claims to their lowest level since March 2008, was much steeper than Wall Street economists expected.
“It’s welcome news,” said Peter Kenny, managing director at Knight Capital in Jersey City, New Jersey.
U.S. stock index futures trimmed losses after the data. U.S. bond prices held gains, while the dollar fell against the yen.
The prior week’s figure was revised slightly higher to 376,000 from the previously reported 374,000.
Hiring by U.S. companies slowed dramatically in the second quarter as employers grew worried about Europe’s snowballing debt crisis, which is weighing on the global economy. Many employers also are concerned over the possibility the U.S. government may cut spending and let tax cuts expire next year, which could send the economy into recession.