Stocks at US wholesalers fell unexpectedly in July and claims for unemployment benefits also dipped, but the two government economic reports on Thursday did not take Hurricane Katrina's full impact into account. Inventories at US wholesalers dropped 0.1 percent, while sales rose 0.5 percent on a jump in demand for oil, the Commerce Department said.
The number of Americans making initial claims for jobless aid fell 1,000 last week, the Labour Department said. However analysts expect that number to jump when data are revised to include a surge of claims after Katrina.
Markets were carefully watching energy costs after the storm. Stock indexes declined on worries that high energy costs would hurt consumer spending in the aftermath of Katrina. The Dow Jones industrial average was down 26 points, or 0.24 percent, at 10,607.
The decline in wholesale stocks was the first since January 2004, the Commerce Department said.
Wall Street analysts had expected wholesale inventories to rise 0.5 percent, according to a Reuters poll.
Stocks of durable goods - products meant to last three years or more - rose 0.3 percent in July, as inventories of electrical equipment, machinery, cars, furniture and lumber rose.
Non-durable stocks fell 0.7 percent, the biggest decline since January 2004, as stocks of drugs plunged 4.9 percent and inventories of paper, groceries, chemicals and alcohol dipped.
The inventories-to-sales ratio, a measure of how long it would take to deplete stocks at the current sales pace, dropped to 1.18 months from 1.19 in June.
The 0.5 percent gain in wholesale sales matched June's advance. Sales of petroleum products by wholesalers jumped 7.6 percent in July, the largest gain since March.
A dip in inventories can mean demand is outstripping wholesalers' ability to stock supplies. But it could also indicate that wholesalers are keeping inventories lean based on doubt about future demand.
In a separate report, the government said an upward revision of jobless claims is expected as hurricane-stricken states on the US Gulf Coast process applications.
First-time claims for unemployment insurance benefits dropped to 319,000 last week from 320,000 the prior week, the Labor Department said. This included about 10,000 disaster-related applications for aid from hurricane-battered Alabama, Louisiana and Mississippi.
Economists surveyed by Reuters had expected claims to fall 5,000 to 315,000 last week.
Hurricane Katrina, the costliest storm to slam into the United States, targeted the worst of its fury on New Orleans and sent tens of thousands out of work.
Louisiana officials said earlier this week they have received an overwhelming number of claims and it would be another week or so until the state can begin to process them.
TOURISM SALES JUMP The US tourism industry grew by an annualised rate of 9.4 percent in the second quarter, but it will not be until December when Hurricane Katrina's full impact on the industry is known, the government said on Thursday.
The US Commerce Department said total tourism sales in the second quarter rose to $1.026 trillion from a revised $1.003 trillion in the first quarter of this year.
"The initial effects of Hurricane Katrina on travel and tourism will be reflected in the next release covering the third quarter of 2005," Commerce said in its quarterly report. Data for the third quarter will be released on December 19.
Hotel accommodations, airfares and souvenirs - or direct tourism sales - accounted for $588.1 billion of the total. Indirect tourism-related sales that include toiletries for hotel guests, airline meals and the materials used to make souvenirs provided $438.1 billion of the total.
Passenger air transportation surged at an annualised rate of 17.8 percent in the second quarter to $100.86 billion, but Commerce attributed that growth to an increase in airfares. Traveler accommodations also grew 11.0 percent to $98.1 billion.
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