Unemployment Claims & The S&P 500

At Alhambra, an indicator we like for a gauge of the recovery is the 4 week moving average of initial unemployment claims.  The data released today remains stubbornly above the 400,000 level and is signaling a bit of ambiguity as to its next directional move.  After a recent surge from 390,000 to 440,000, the indicator is looking a bit more bullish; we remain unconvinced especially with recent layoffs in the news and the indecision by the government on the deficit reduction and debt ceiling issues.