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NIKKO MARKET COMMENTS
Prepared by
The Nikko Securities Co. International, Inc.
Economic News
Nonfarm productivity posted a larger than expected 4.5% gain in 97Q3. Nonfarm unit labor costs fell by 0.3%, in contrast to market estimates for a 1.0% rise. Output per hour in the manufacturing sector surged to a 9.8% annualized growth rate, outsizing the 2.5% to 3% rates in the first half of 1997. Strong productivity growth and a decline in unit labor costs counteract higher wages from transmitting pressure to consumer prices. The Fed's suspicion that productivity growth will slow has no basis in 97Q3. Its concerns are still valid for the quarters ahead, however, as labor conditions tightened further in early Q4. Jobless claims fell to 310,000 in the latest week, bringing the four-week average to 309,000. Claimants receiving benefits totaled 2246, just 5 thousand more than last week. The insured unemployment rate remains at 1.9%. Consumer comfort seems unaffected by recent market fluctuations. The ABC/Money index held steady this week at 6.
Robert A. Brusca, Chief Economist
The Nikko Securities Co., International, Inc.
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Financial Commentary | Consensus National Futures and Financial On Line Index
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