By John S. McClenahen Initial claims for unemployment insurance dropped dramatically last week, falling to 335,000, some 37,000 less than the previous week's revised figure of 372,000, the U.S. Department of Labor reported on Oct. 7. The claims figure for the week ending Oct. 2 was 20,000 below the 355,000 economists generally expected. However, the department's four-week moving index for initial claims, often regarded as a better indicator of underlying labor market conditions, rose slightly last week to 348,500, an increase of 4,250 claims from the previous week's revised average of 344,250. But that uptick may be misleading. Says Sheryl King, a senior economist at Merrill Lynch & Co., New York: "If you subtract the impact of recent hurricanes -- particularly in Alabama, Florida and Puerto Rico -- the four-week average would be about 346,000, "not a sign of robust employment growth, but neither . . . a sign of deterioration."