Vital Signs: Housing and Subprime Hangover

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JOBLESS CLAIMS - Thursday, July 26, 8:30 a.m. EDT

Jobless claims for the week ended July 14 shrank to 301,000, after easing to a revised 309,000 for the week ended July 7. The original level for the previous week was 308,000. The four-week moving average dropped to 312,000, from 318,250 in the week ended July 7. Continuing jobless claims for the week ended July 7 rose to 2.57 million, from 2.55 million.

DURABLE GOODS ORDERS - Thursday, July 26, 8:30 a.m. EDT

Durable goods orders probably rebounded in June, after a sizeable drop in May. A 22.6% plunge in orders for civilian aircraft helped pull down overall orders by 2.4%. Outside of aircraft, orders were off 0.6%. Construction machinery and home appliance orders both posted double-digit drops as weakness in housing continues. However, computer orders rebounded 18.1%, after a 10.3% fall in April.

An area to watch is capital goods orders minus defense equipment and civilian aircraft. Striping out defense and volatile aircraft orders gives a better sense of business investment trends. This core capital goods measure was off 2.1% in May, after two solid gains of 2% and 4.6% in April and March, respectively.

NEW RESIDENTIAL SALES - Thursday, July 26, 10 a.m. EDT

New single-family homes sales probably slowed a little more in June. Sales in May fell to an annual pace of 915,000, after jumping to 930,000 in April, from 827,000 in March. The May decline was centered in the Northeast and South, while sales in the Midwest jumped to the highest level since a weather-aided January performance.

One good sign from the May numbers was a small decline in the number of homes for sale -- falling to 536,000, or about 7 months worth of sales. In April, the inventory of unsold homes was 542,000, or a 7.1 month supply. The number of unsold completed homes is also beginning to edge down, while the median sales price of a home fell 0.9% from a year ago -- signs that home builders are making the needed concessions to start working off inventories.

HELP-WANTED INDEX - Thursday, July 26, 10 a.m. EDT

The Conference Board issues its May index of help-wanted ads, based on ads gathered from major newspapers across the nation. The index eroded to 27 in May. That's below the reading of 29 for April and March, as well as the May, 2006 reading of 33. Help-wanted ads declined in six of the nine U.S. regions during the three month period ended in May. At the same time, the percentage of markets with rising want-ad volumes plummeted to 18%, from 49% in April and 45% in March.

The Conference Board's tracking of online job ads did retreat a little in June. However, these figures are not seasonally adjusted. Total monthly online job ads fell by 25, or 94,000 persons. The number of advertised vacancies online for every 100 persons in the labor force slipped to 2.8, from 2.9 in the prior two months.

GROSS DOMESTIC PRODUCT - Friday, July 27, 8:30 a.m. EDT

Economic growth in the second quarter of 2007 probably looked a lot better than the first quarter. Economists queried by Action Economics are forecasting real GDP growth of 3.2% on an annualized basis after a paltry 0.7% increase in the first quarter.

Among the different areas of the economy, an increase in inventories, a rebound in price-adjusted exports, and another big increase in non-residential construction all juiced growth in the second quarter. But the gains in those areas will be countered by another decline in home building and a considerably slower pace of consumer spending growth.

CONSUMER SENTIMENT INDEX - Friday, July 27, 10 a.m. EDT

The University of Michigan and Reuters will issue the final reading of consumer sentiment for July. The index probably gave back some of the gains in the initial July results. The preliminary July reading was 92.4, as consumers felt better about current conditions. Most of the improvement came from a large jump in the future expectations index. The final level was 85.3 in June and 88.3 in May.

Respondents in the early July survey expressed a lot more optimism about the U.S economy for the coming year. The retreat in gasoline prices during June and early July may have consumers feeling more upbeat. However, the Energy Information Administration reports that the average price for a gallon of gasoline did increase in the past two weeks.

Mehring is economics writer for BusinessWeek .