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WASHINGTON (Reuters) - The number of Americans claiming new unemployment benefits was steady last week and heavy discounting lifted sales at retailers in July, hopeful signs for the sputtering economy.
Initial claims for state jobless benefits edged down 1,000 to 400,000, the Labor Department said on Thursday. Economists had expected claims to rise to 405,000 and the dip last week indicated an easing in layoffs, which have weighed on employment in the past two months.
"While the economic slowdown appears to be stretching into the third quarter, what really matters is jobs," said Millan Mulraine, a macro strategist at TD Securities in New York.
"The pace of job losses has eased relative to what it was a few weeks ago and that is important because it could reflect positively on confidence going forward."
There was also more encouraging news for the economy, whose growth pace stalled in the first half of this year.
Retailers, including Limited Brands and teen apparel chains Hot Topic Inc and Wet Seal, reported healthy monthly sales increases in July as deep discounts and unusually warm weather lured shoppers to malls.
Twenty-five retailers tracked by Thomson Reuters reported a 4.4 percent gain in July sales at stores open at least a year, just above expectations of a 4.3 percent rise.
But the reports failed to ease investors' fears over the stalled recovery, which were exacerbated by Europe's inability to tame its spreading debt crisis.
U.S. stocks tumbled in their worst sell-off in two years, while Treasury debt prices soared. The dollar rallied broadly after the ECB kept interest rates on hold and the Bank of Japan intervened in the market to curb the yen's rise.
U.S. gross domestic product grew at an annual pace of 1.3 percent in the second quarter after a negligible 0.4 percent rate in the January-March period.
Data so far show the anemic growth pace persisted early in the third quarter, with manufacturing hitting a two-year low in July and the services sector expanding at its slowest pace in nearly 1-1/2 years.
Initial claims for state jobless benefits edged down 1,000 to 400,000, the Labor Department said on Thursday. Economists had expected claims to rise to 405,000 and the dip last week indicated an easing in layoffs, which have weighed on employment in the past two months.
"While the economic slowdown appears to be stretching into the third quarter, what really matters is jobs," said Millan Mulraine, a macro strategist at TD Securities in New York.
"The pace of job losses has eased relative to what it was a few weeks ago and that is important because it could reflect positively on confidence going forward."
There was also more encouraging news for the economy, whose growth pace stalled in the first half of this year.
Retailers, including Limited Brands and teen apparel chains Hot Topic Inc and Wet Seal, reported healthy monthly sales increases in July as deep discounts and unusually warm weather lured shoppers to malls.
Twenty-five retailers tracked by Thomson Reuters reported a 4.4 percent gain in July sales at stores open at least a year, just above expectations of a 4.3 percent rise.
But the reports failed to ease investors' fears over the stalled recovery, which were exacerbated by Europe's inability to tame its spreading debt crisis.
U.S. stocks tumbled in their worst sell-off in two years, while Treasury debt prices soared. The dollar rallied broadly after the ECB kept interest rates on hold and the Bank of Japan intervened in the market to curb the yen's rise.
U.S. gross domestic product grew at an annual pace of 1.3 percent in the second quarter after a negligible 0.4 percent rate in the January-March period.
Data so far show the anemic growth pace persisted early in the third quarter, with manufacturing hitting a two-year low in July and the services sector expanding at its slowest pace in nearly 1-1/2 years.