LIVE MARKETS-Thursday data: Jobless claims, layoffs, trade balance

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THURSDAY DATA: JOBLESS CLAIMS, LAYOFFS, TRADE BALANCE

Investors began the last day of a volatile, up-and-down, holiday-shortened week on Thursday with three fairly anodyne bits of economic data.

Last week, 202,000 U.S. workers joined the queue outside the unemployment office USJOB=ECI, down 4.3% from the week prior, and 10,000 fewer than analysts expected.

Ironing out weekly volatility, the four-week moving average of initial claims now has a modest downward bias, remaining within the lower end of the range associated with healthy labor market churn.

The relatively low number of claims appears to add support to the notion that the U.S. labor market is in low-hire, low-fire mode, as illustrated by Tuesday's JOLTS report.

"Initial jobless claims fell to their lowest level since the start of the year in the week ended March 28, confirming that, while hiring remains depressed, layoffs remain low," writes Nancy Vanden Houten, lead economist at Oxford Economics.

Speaking of which, outplacement firm Challenger, Gray & Christmas (CGC) USCHAL=ECI reports U.S. firms announced 60,620 layoffs in March, a monthly increase of 25%. Still, that's 78% fewer than the 275,240 job cuts announced in March 2025.

That brings the first quarter total to 217,362, the lowest Q1 total in four years and down 56% from Q1 2025.

Technology firms are responsible for nearly one in four of all job cuts so far in 2026, largely attributed to artificial intelligence, which was the most widely cited rationale for job cuts.

"Companies are shifting budgets toward AI investments at the expense of jobs," says Andy Challenger, senior vice president at CGC. "The actual replacing of roles can be seen in Technology companies, where AI can replace coding functions. Other industries are testing the limits of this new technology, and while it can’t replace jobs completely, it is costing jobs."

"AI is changing work and the workforce," Challenger adds.

So far in 2026, hiring is down 6% from the same period a year ago.

On the other hand, continuing jobless claims USJOBN=ECI, which are reported on a one-week lag, rose 1.4% to 1.841 million, just a hair north of consensus.

Ongoing claims remain elevated, lending credence to recent survey data suggesting laid-off workers are finding it increasingly difficult to find a replacement gig.

All of the above is prologue to the Labor Department's March employment report due tomorrow, a market holiday.

Economists expect that report to show the U.S. economy added an unimpressive 60,000 jobs last month, with the unemployment rate holding steady at 4.4%.

Separately, the trade gap USTBAL=ECI, or the difference in the value of goods and services imported to the U.S. and those exported abroad, widened by 1.4% to $57.3 billion.

The reading is $3.7 billion narrower than economists predicted.

Under the hood, imports and exports grew by 4.3% and 4.2%, respectively, with the goods deficit widening by 3.0%. The closely watched trade deficit with China narrowed by 13.5%.

"Two-thirds of the increase in exports in February reflected a surge in gold exports, which have been volatile lately," says Oliver Allen, senior U.S. economist at Pantheon Macroeconomics. "By contrast, February’s jump in imports was relatively broad-based, although imports of computer equipment and semiconductors leapt again, due to the ongoing surge in AI-related capex."

(Stephen Culp)

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