WASHINGTON — First-time claims for state unemployment benefits fell more than expected last week, dropping below the important 400,000 level for the first time since April, according to a government report on Thursday.
At the same time, a private trade group said sales of existing homes rose unexpectedly in June, and both statistics gave investors a reason for optimism.
Jobless claims dropped 24,000, to a seasonally adjusted 398,000, the Labor Department said.
The drop below the 400,000 level that is normally associated with stable job growth will be welcome news for the economy after a recent string of weak data. Employment growth stumbled badly in May and June, with the increase in nonfarm payrolls totaling only 43,000.
Economists had forecast that claims would fall to 415,000. The prior week’s figure was revised to 422,000 from 418,000.
The government was expected to report on Friday that the economy grew at a 1.8 percent annual rate, according to a Reuters survey, after a tepid 1.9 percent pace in the first three months of the year.
On Wednesday, the Federal Reserve said growth had slowed in much of the country in June and early July.
Pending sales of existing homes unexpectedly rose in June from May and rose sharply from a year ago, data from a real estate trade group showed on Thursday.
The National Association of Realtors Pending Home Sales Index, based on contracts signed in June, was up 2.4 percent to 90.9 from 88.8 in May. The index was up 19.8 percent from a year ago.
Economists polled by Reuters ahead of the report were expecting pending home sales to fall 2.0 percent.
The association’s senior economist, Lawrence Yun, said despite the uptick, the latest monthly reading showed tight credit and economic uncertainty were still constricting the market.
“The best way to ensure a more solid recovery in housing is to simply return to normal, sound credit standards so more creditworthy home buyers can get a mortgage,” he said.
At the Labor Department, an official said there were no special factors in last week’s jobless claims data.
The four-week moving average of claims, considered a better measure of labor market trends, fell 8,500, to 413,750.
A total of 7.65 million people were claiming unemployment benefits in the week ended July 9 under all programs, up 320,152 from the previous week.
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