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By Carlos Guillen

Equity markets are on a nice uptick so far during today's trading session as two favorable
Forward looking economic indicators have come together to signal a rather encouraging short term outlook.

Initial Claims data posted earlier today was a certainly encouraging, as the result was better than expected, making a sharp reversal. According to the Department of Labor, initial claims during the week ended January 12 totaled 335,000, decreasing from the 372,000 revised figure reported for the prior week and landing below the Street's estimate of 370,000. This result marked the lowest level since January 19, 2008 when initial claims clocked in at 318,000 and may help to assuage investor's concerns that the jobs situation may have been worsening during the prior four weeks. The sharp drop in the result also pulled the initial claims' four-week moving average to 359,250, decreasing from the prior week's average of 366,000. As it stands, economists estimate that initial claims below 350,000 a week indicate strong job growth. But the numbers can vary widely from week to week, so we would prefer to see the moving average land below the 350,000 to have more confidence that there indeed is job growth.

Also a bit encouraging today was that housing permits and starts data are maintaining their uptrend. According to the U.S. Census Bureau, building permits during December increased year-over-year by 28.8 percent and increased month-over-month by 0.3 percent to 903,000; however the result was a bit lower than the Street's consensus estimate of 905,000. Concurrently, housing starts climbed year-over-year by 36.9 percent and rose month-over-month by 12.1 percent to 954,000, which was the highest level since June 2008 and was well above the Street's consensus estimate of 889,000. So the combination of strong building permit growth, which is a proxy for future construction, combined with strong single family starts is clearly coming together to give investors more confidence that the housing sector is holding up well.

So at the moment stock markets are experiencing some nice gains, with the Dow Jones Industrial Average up over 80 points, but there is still lots more to come as earnings season unfolds. After the closing bell today Intel will deliver its financial results for the fourth quarter, and tomorrow we have Michigan sentiment data, both of which could shake markets in the morning.