Upbeat news about the state of the U.S. job market has pushed stocks and exchange traded funds (ETFs) higher this morning. However, while the rate of layoffs has slowed, there’s a downside that’s concerning some economists.

The Labor Department has reported that the number of newly laid-off workers last week dropped to 512,000, the lowest point since January. It’s also 4,000 fewer than what economists had forecast. The report has a downside, though: worker productivity in the third quarter rocketed by 9.5%. This means that employers are becoming more efficient and more productive, so companies will have little reason to hire more, report Martin Crutsinger and Christopher S. Rugaber for the Associated Press.

The European Central Bank kept interest rates at a record low today, as expected. Later, the bank’s president will hold a press conference that many expect will give hints as to when the ECB will begin to cut back on bank lending and whether it intends to charge them more for 12-month money, reports Jana Randow for Bloomberg. iShares MSCI EMU (NYSEArca: EZU) is up about 1.5% this morning. (How Europe can keep the ball rolling).

The outlook for retailers brightened somewhat in October. Chain-store sales notched their second consecutive gain, and it was the best performance for the industry in more than a year. The industry reported an overall 1.8% sales jump at stores open for at least a year, reports Stephanie Rosenbloom for The New York Times. Not entirely surprisingly, chains that sell designer brands at a discount were the strongest performers. SPDR S&P Retail (NYSEArca: XRT) is down about 0.7% this morning. (Brand names boost consumer staples).

Climate legislation received a boost today as Senate Democrats received approval of a cap-and-trade bill that aims to reduce U.S. greenhouse gases. Republicans object to the legislation because they feel that it’s being rushed, reports Simon Lomax for Bloomberg. The House bill seeks to reduce emissions by 17% below 2005 levels by 2020; the Senate bill is calling for a deeper cut of 20%. iShares S&P Global Clean Energy Index (Nasdaq: ICLN) is up nearly 2% this morning.

For full disclosure, Tom Lydon’s clients own shares of EZU.

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