Market commentary

Jobless claims for the week ending July 30 decreased 1,000 to 400,000; a welcome improvement. This is not enough, however, to repair the dismal labor market, and is the last piece of data on the labor market prior to Friday morning’s Labor Department report on job growth and the unemployment rate. Economists are projecting employers added 85,000 workers in July and the unemployment rate will hold above 9%.

This data had little effect on the markets as concerns about Spain and Italy grow. The overnight rate banks charge each other is increasing and some European banks are being shut out of the market. The European Central Bank has stepped in to provide liquidity to these banks. Global stock markets are being hit hard, including markets in the U.S. with the DOW lower by 250 points. U.S. Treasuries, the Swiss franc and gold are all beneficiaries of the flight to safety. The yield on the 10 year note has fallen to 2.51% and mortgage prices have improved by another .375%. Yes, you may expect volatility to continue.