December private-sector jobs rise 325K: ADP (by Ruth Mantell)

WASHINGTON (MarketWatch) -- Private-sector payrolls increased 325,000 in December, led by the service-providing sector and small businesses, according to the ADP employment report released Thursday. The November level was revised to 204,000 from a prior estimate of 206,000. Markets look to ADP's report on private-sector payrolls to provide some guidance on the U.S. Labor Department's jobs estimate, which will be released Friday and includes information on both private- and public-sector payrolls. However, analysts have noted seasonal-adjustment issues that have led to past ADP estimates for December substantially missing the government's data. Economists polled by MarketWatch expect the Labor Department on Friday to report strengthening employment, with overall nonfarm payrolls up 150,000 in December, compared with 120,000 in November. Economists also expect the unemployment rate to rise to 8.7% from 8.6%.

Planned job cuts down 1.6% in December: Challenger (by Steve Goldstein)

WASHINGTON (MarketWatch) -- Planned job cuts announced by U.S. employers declined in December to 41,785, the lowest monthly total since June, according to outplacement firm Challenger, Gray & Christmas. The figure was down 1.6% from November but up 31% from December 2010. For all of 2011, job cuts rose 14% to 606,082. The recession peak was in 2009 with 1.29 million.

Weekly jobless claims drop 15,000 to 372,000 (by Jeffry Bartash)

WASHINGTON (MarketWatch) - The number of Americans who filed requests for jobless benefits fell by 15,000 last week to 372,000, the U.S. Labor Department said Thursday. Claims from two weeks ago were revised up to 387,000 from 381,000. Economists surveyed by MarketWatch had projected claims would drop to a seasonally adjusted 373,000 in the week ended Dec. 31. The average of new claims over the past four weeks, meanwhile, declined by 3,250 to 373,250, the lowest level since June 2008. Also, the Labor Department said continuing claims decreased by 22,000 to a seasonally adjusted 3.6 million in the week ended Dec. 24. Continuing claims are reported with a one-week lag. About 7.22 million people received some kind of state or federal benefit in the week ended Dec. 17, down 8,311 from the prior week. Total claims are reported with a two-week lag.

30-year mortgage rate falls to 3.91% (by Ruth Mantell)

WASHINGTON (MarketWatch) -- The average rate on the 30-year fixed-rate mortgage fell to 3.91% in the week ended Jan. 5, matching a record low, compared with 3.95% in the prior week, Freddie Mac said Thursday. A year ago the rate was at 4.77%. To obtain the latest rate, payment of an average 0.8 point was required, according to Freddie, a buyer of residential mortgages. A point is 1% of the mortgage amount, charged in prepaid interest. "Fixed mortgage rates started the year a little lower this week just as recent data reports indicate the housing market and manufacturing industry are showing signs of improvement," said Frank Nothaft, Freddie Mac's chief economist, in a statement. The 15-year fixed-rate mortgage declined to 3.23% in the latest week from 3.24% in the prior week. Meanwhile, the average rate on the 5-year Treasury-indexed hybrid adjustable-rate mortgage declined to 2.86% from 2.88%. The 1-year Treasury-indexed ARM increased to 2.80% from 2.78%.

December ISM services rises but misses forecast (by Steve Goldstein)

WASHINGTON (MarketWatch) -- The Institute for Supply Management's services index rose in December to a reading of 52.6% from November's 52.0%, a reading that nonetheless was below the 53.3% MarketWatch-compiled economist forecast. Of key subcomponents, production stayed at 56.2%, new orders edged up 0.2 points to 53.2% and employment rose 0.5 points to 49.4%. Any reading over 50% indicates expansion, and the services gauge has shown growth for 25 straight months, ISM said.

Leading U.S. economic index undergoes overhaul (by Jeffry Bartash)

WASHINGTON (MarketWatch) - The research firm that publishes the leading U.S. economic index said Thursday it has overhauled the report to take into account big changes in the economy. The Conference Board said it will remove several components of its index and revamp others. Real Money Supply will be replaced by a new Leading Credit Index, retroactive to 1990, and the Supply Delivery Index will be replaced by ISM New Orders Index. The board will also revise its consumer sentiment index and a component that measures new orders for noncapital defense. The board said these are the first major changes to the leading economic index since 1996, and that they will take effect Jan. 26. "These adjustments have been designed to make the U.S. Leading Economic Index an even stronger predictor of peaks and troughs in the business cycle, while recognizing changes in the functioning and drivers of the economy in the short and medium term," said Bart van Ark, chief economist at the Conference Board.