First-time jobless claims rose by 30,000 to a seasonally adjusted 442,000 for the week ended April 12, the Labor Department said. It was the ninth straight week that claims held above the key 400,000 level, regarded by economists as a sign of an unhealthy labor market.

Much of the rise reflects an increase in layoffs in the auto industry, a Labor Department official said.

The gain was well above expectations. Economists in a Reuters poll had forecast, on average, that jobless claims would edge up to 411,000.

"The story remains the same: labor markets remain weak, and as we are all anticipating a rebound in consumer confidence that is related to the end of the war, the question is how much will the labor market temper this uptick in consumer confidence and I think we need to take that seriously," said Kathleen Stephansen, senior international economist, Credit Suisse First Boston in New York.

U.S. Treasury bonds inched up higher on the weaker-than-expected report while the dollar dipped. Stock markets were expected to focus on company earnings results.

Adding to the mounting evidence of an eroded labor market, the four-week moving average -- considered a more reliable measure because it irons out weekly fluctuations -- moved up to its highest level in nearly a year.

And, the number of workers continuing on state unemployment benefits hit a seasonally adjusted 3.6 million for the week ended April 5, the most recent week these data were available. That was the highest level reached since last Novem

By: DocMemory
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