“Kyodo Securities” / US Jobless Claims Rise.

Kyodo Securities: Worse than expected jobless claims data sparks rout in equity markets.

Kyodo Securities, the Asia-based asset management firm is apparently unsurprised by the higher than expected number of U.S. workers filing initial claims for jobless benefits. The numbers provided evidence that layoffs continue, and jobs remain scarce, the Asian-based investment house said.

The news, together with worries about debt levels in EU member nations, sparked a sharp selloff in global equity markets. The Dow Jones industrial average fell 270 points or 2.6 percent and ended the trading session below 10,000.

A source close to analysts at the firm said that commentators who had remained inexplicably bullish on the prospects for recovery in the US economy were now witnessing their chickens coming home to roost.

Despite the efforts of the Obama administration, unemployment continues to remain stubbornly at 10% although Kyodo Securities believes that the true figure is closer to 16 or 17% unemployment.

The firm’s analysts believe that the jobs report for the first month of 2010 is likely to surprise analysts by showing an additional loss of some 20,000 jobs in the world’s biggest economy against expectations of a positive jobs month in the region of 10,000 and has advised clients to expect a continuation of the selloff in equity markets around the world.