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U.S. recovery still a mixed picture
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The Associated Press
New data out Thursday continued to show a mixed picture about economic recovery in the U.S.
Factory activity in Canada's largest trading partner grew last month at the fastest pace since June, construction spending increased for a third straight month, and both retail sales and auto sales rose in November.
But the number of first time jobless claims is still too high to signal strong hiring.
The data came a day before both Canada and the U.S. report on job growth in November.
Economists in Canada expect the report here to show 11,000 jobs created, keeping the unemployment rate at 7.3 per cent.
Those in the U.S. project a net increase of 125,000 jobs, still not enough to push the American unemployment rate below its present nine per cent.
The Institute for Supply Management, a trade group of purchasing managers, said Thursday that its manufacturing index rose to 52.7 in November, up from 50.8 in October. Any reading above 50 indicates expansion.
An index that measures new orders rose to a seven-month high.
Europe may be a distraction
Bradley Holcomb, chair of the ISM's survey committee, said manufacturers "are cautiously more optimistic about the next few months based on lower raw materials pricing and favourable levels of new orders," he said.
Still, companies have tempered their outlook with concerns about future economic growth, government regulation and the debt crisis in Europe, he added.
The focus on Europe may be a distraction, said Dan Sumner, an economist at Edmonton-based ATB Financial.
“With European financial worries dominating the headlines, the positive economic readings seem to go practically unnoticed,” Sumner said in a commentary.
“Until an ultimate resolution to the European sovereign debt concerns is in sight, financial markets are likely to remain in upheaval, reacting violently to rumours and news. However, thus far, it appears the North American economy is surviving the situation better than many of the news headlines imply.”
Separately, the Labor Department said the number of Americans who applied for unemployment benefits last week rose above 400,000 for the first time in four weeks.
The increase came after applications had drifted lower over the past two months.
A third report showed that U.S. builders spent more in October on new homes, offices and shopping centers. Construction spending rose for a third straight month, the Commerce Department said.
Despite the gains, overall construction spending remained depressed.
And the International Council of Shopping Centers on Thursday reported that retailers from Macy's to Costco reported November revenue at stores open at least a year that beat Wall Street estimates. The overall tally for 21 retailers showed revenue higher from November a year earlier by 3.2 per cent.
As well, Chrysler, General Motors and Nissan reported big gains in November auto sales as Americans bought new cars at the fastest pace in two years.
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