Initial jobless claims rose 8,000 to 229,000 in the week ending June 1 after a small upward revision to 221,000 in the May 25 week. The four-week moving average is down a scant 75 to 222,250 in the June 1 week. The June 1 level is above the consensus of 216,000 in the Econoday survey of forecasters. While two weeks of increasing claims is too early to declare a trend higher, it does appear that levels of claims are now a little more elevated than seen in March and April.

The level of insured jobless claims is essentially unchanged at up 2,000 to 1.792 million in the May 25 week after 1.790 million in the prior week. Recent week-to-week changes in the level of insured benefits have been generally small and leave the underlying trend not far off the headline. In the May 25 week, the four-week moving average is up 2,750 to 1.789 million.

In the May 25 week, the insured rate of unemployment remains unchanged at 1.2 percent where it has been for the past 15 months. Unemployment remains low and stable for those eligible for unemployment benefits.

Jobless claims for the June 1 week are expected to hold steady at 216,000 versus 219,000 and 216,000 in the two prior 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.