RBC Financial Group economists say that the two important economic releases in the U.S. today – initial unemployment claims and durable goods orders – both “point to a recovering economy anchored, so far, by resilient consumer spending and soon by business investment as well”.

U.S. Initial jobless claims for last week fell by 9,000 to 416,000, its lowest level since March 23. “This number remains relatively high, which is indicative of a still sluggish labour market. Moreover, continuing claims continue rising and, at 3,870,000 for the week ending May 11, are at their highest level since early 1983,” notes RBC.

While the jobs picture remains sluggish, new durable goods orders posted a much stronger gain than expected in April, rising 1.1%. “U.S. durable goods industries are beginning to get some traction according to today’s April new orders report. Excluding transportation equipment, where aircraft orders were down, new orders rose 2.9%. Even the headline 1.1% increase in total durable goods orders was respectable,” says BMO Nesbitt Burns.

“The report suggests that businesses are finally showing signs of improved confidence, which points to a pick-up in business investment in the second half of the year,” notes RBC.

“The strong U.S. new orders number moved chances for a decent factory rebound higher. As always, you can slice and dice durable goods orders to show the figures are not conclusive. Our hunch is that the factory sector is starting to heal,” says BMO Nesbitt.