Leading Indicators, Jobless Claims Add To Optimism

ByJohn S. McClenahen Unlike the depressing weather that remains parked over the mid-Atlantic states, the sluggish U.S. economy may be showing welcome signs of real movement. The Conference Board's index of leading economic indicators rose a full percentage point in May to 111.6 (1996=100). Although higher stock prices, real money supply and consumer confidence accounted for much of the increase, most other index components showed at least slight gains. May was the second consecutive month that the index of leading indicators has risen. In April it advanced 0.1%. "It is possible that these two consecutive increases reflect the beginning of an upward trend," says the Conference Board, a New York-based business research group. The latest U.S. Labor Department unemployment claims data are not quite as encouraging, but both the number of initial claims and the four-week moving average were down last week. For the week ending June 14, the seasonally adjusted number of initial claims for unemployment insurance was 421,000, a decrease of 13,000 from the previous week's revised figure of 434,000. The four week moving average was 432,000 claims, some 3,000 fewer than the previous week's revised average of 435,000. Merrill Lynch & Co. senior economist Gerald D. Cohen, looking at other figures in the latest Labor Department report, notes while continuing claims for unemployment insurance fell by 62,000, they were "still high" at 3.721 million for the week ending June 7. To him these numbers suggest "that while job loss is lessening, those without a job are having a hard time finding a new one."