Initial jobless claims are down 5,000 to 207,000 in the April 20 week after an unrevised 212,000 in the prior week. The level is below the consensus of 215,000 in the Econoday survey of forecasters. The four-week moving average is down 1,250 to 213,250 in the April 20 week. Applications for jobless benefits remain low, fairly stable, and consistent with a tight labor market.

The level of insured jobless claims is down 15,000 to 1.781 million in the April 13 week after a downward revision to 1.769 million in the prior week. The four-week moving average is down 7,250 to 1.794 million in the April 13 week. Among those eligible for unemployment benefits, the number of persons receiving payments also remains relatively low and stable, and consistent with a tight labor market. The insured rate of unemployment is unchanged at 1.2 percent in the April 13 week for over a year.

Initial claims for the April 20 week are expected to come in at 215,000 versus 212,000 in the prior two weeks and 212,000 in five of the last six weeks. The four-week average has held at 214,500 for the past three weeks.

New unemployment claims are compiled weekly to show the number of individuals who filed for unemployment insurance for the first time. An increasing (decreasing) trend suggests a deteriorating (improving) labor market. The four-week moving average of new claims smooths out weekly volatility.

Jobless claims are an easy way to gauge the strength of the job market. The fewer people filing for unemployment benefits, the more have jobs, and that tells investors a great deal about the economy. Nearly every job comes with an income that gives a household spending power. Spending greases the wheels of the economy and keeps it growing, so a stronger job market generates a healthier economy.

There's a downside to it, though. Unemployment claims, and therefore the number of job seekers, can fall to such a low level that businesses have a tough time finding new workers. They might have to pay overtime wages to current staff, use higher wages to lure people from other jobs, and in general spend more on labor costs because of a shortage of workers. This leads to wage inflation, which is bad news for the stock and bond markets. Federal Reserve officials are always on the look-out for inflationary pressures.

By tracking the number of jobless claims, investors can gain a sense of how tight, or how loose, the job market is. If wage inflation looks threatening, it's a good bet that interest rates will rise, bond and stock prices will fall, and the only investors in a good mood will be the ones who tracked jobless claims and adjusted their portfolios to anticipate these events.

Just remember, the lower the number of unemployment claims, the stronger the job market, and vice versa.