Jobless claims at 3.5-year low

The number of Americans filing new claims for jobless benefits hit a 3-1/2 year low last week, bolstering views the economy was gaining momentum, even though third-quarter growth was revised down.

Initial claims for state unemployment benefits dropped 4,000 to a seasonally adjusted 364,000, the Labor Department said on Thursday, the lowest level since April 2008.

The claims data, which covered the survey period for nonfarm payrolls, helped to take the sting out of a separate report from the Commerce Department showing that gross domestic product grew at a 1.8 per cent annual rate in the third quarter.

Growth, which had previously been reported to have expanded at a two per cent pace, was held back by a sharp drop in healthcare spending.

"The employment situation continues to show strong signs of a recovery and goes against the grain of what people felt four months ago," said Andrew Wilkinson, chief economic strategist at Miller Tabak & Co in New York.

Stock index futures briefly extended gains on the data, while Treasury debt prices rose. The dollar rose against the euro.