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STORY: Just days after a disappointing monthly jobs report panicked investors and sent stocks tumbling, data on Thursday showed that... maybe the labor market isn't so weak after all.

The number of Americans filing for unemployment benefits last week fell to a lower-than-expected 233,000, according to the U.S. Labor Department.

That's a drop of 17,000 applicants from the week before - the largest decline in about 11 months.

It was welcome relief for investors, who had shed equities and other risky assets after Friday's nonfarm payrolls report showed job gains slowed markedly in July and the unemployment rate rose to 4.3%.

That boosted recession fears, prompting some to predict the Federal Reserve might begin hiking rates more aggressively than expected to steady the economy.

The prior weekly jobless claims number had also signaled potential trouble - rising much more than economists had expected.

That now looks like it may have been due in part to seasonal motor vehicle plant shutdowns and disruptions caused by Hurricane Beryl in Texas.

Meanwhile, other data on Thursday from the Commerce Department showed that U.S. wholesale inventories increased in June, adding to economic growth in the second quarter.

The economy grew at a pace of 2.8% in the second quarter - double the growth pace in the first quarter.