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Market Sleuths to Parse Fed Chair Powell's Wording
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Tuesday, March 7th, 2023
Pre-market futures are up tepidly ahead of today’s opening bell, as market participants await Fed Chair Jay Powell’s appearance on Capitol Hill this morning before the Senate Banking Committee. The Dow, which closed very marginally higher, is looking for its fourth-straight day in the green — its best string since January. Currently, the S&P 500 is up +1 point, the Dow is +20 and the Nasdaq +15 points.
The “cheat sheet” for today’s Fed speak (Powell also appears before the House tomorrow) is to listen for any tack toward a 50 bps interest rate hike at the n4ext FOMC meeting on March 22nd, or if he remains committed to the 25 bps hike anticipated and laid out in the Fed’s latest dot-plot. The Chair’s hands are tied a bit today, coming as this address does prior to February jobs numbers Friday and next week’s Inflation Rate update.
Thus, we’re not convinced that the market is going to know much more after Powell’s talks than they do right now. More likely, he will remain strictly on point that the Fed is “data driven.” That said, there is something of a cottage industry in parsing through terms used by the Fed Chair (though it pales in comparison to the prognosticators a generation ago when Alan Greenspan was Fed Chair), and any variation Powell utters over the next two days will be seized upon.
We would advise not making to much of any of this, however. There simply isn’t a lot of datas from which the market beasts feed these days. After the open — right around the same time Powell first appears today — we’ll see Wholesale Inventories for January. These are expected to sink to -0.4% from a previous +0.1%. At 3pm ET today, Consumer Credit, also for January, is expected to more than double to roughly $25 billion.
None of this will be as important as the ADP (ADP - Free Report) private-sector payrolls out tomorrow morning (on which Powell may, in fact, have a new comment), Weekly Jobless Claims Thursday morning and, of course, the Employment Situation report from the U.S. Bureau of Labor Statistics (BLS) and Household Survey. Last we saw, these job reports figures from the BLS were jaw-droppingly strong: 517K new jobs filled, 3.4% unemployment. Current consensus estimates are for the 3.4% to continue, with fewer than half the total of news jobs generated in February.
Image: Bigstock
Market Sleuths to Parse Fed Chair Powell's Wording
Tuesday, March 7th, 2023
Pre-market futures are up tepidly ahead of today’s opening bell, as market participants await Fed Chair Jay Powell’s appearance on Capitol Hill this morning before the Senate Banking Committee. The Dow, which closed very marginally higher, is looking for its fourth-straight day in the green — its best string since January. Currently, the S&P 500 is up +1 point, the Dow is +20 and the Nasdaq +15 points.
The “cheat sheet” for today’s Fed speak (Powell also appears before the House tomorrow) is to listen for any tack toward a 50 bps interest rate hike at the n4ext FOMC meeting on March 22nd, or if he remains committed to the 25 bps hike anticipated and laid out in the Fed’s latest dot-plot. The Chair’s hands are tied a bit today, coming as this address does prior to February jobs numbers Friday and next week’s Inflation Rate update.
Thus, we’re not convinced that the market is going to know much more after Powell’s talks than they do right now. More likely, he will remain strictly on point that the Fed is “data driven.” That said, there is something of a cottage industry in parsing through terms used by the Fed Chair (though it pales in comparison to the prognosticators a generation ago when Alan Greenspan was Fed Chair), and any variation Powell utters over the next two days will be seized upon.
We would advise not making to much of any of this, however. There simply isn’t a lot of datas from which the market beasts feed these days. After the open — right around the same time Powell first appears today — we’ll see Wholesale Inventories for January. These are expected to sink to -0.4% from a previous +0.1%. At 3pm ET today, Consumer Credit, also for January, is expected to more than double to roughly $25 billion.
None of this will be as important as the ADP (ADP - Free Report) private-sector payrolls out tomorrow morning (on which Powell may, in fact, have a new comment), Weekly Jobless Claims Thursday morning and, of course, the Employment Situation report from the U.S. Bureau of Labor Statistics (BLS) and Household Survey. Last we saw, these job reports figures from the BLS were jaw-droppingly strong: 517K new jobs filled, 3.4% unemployment. Current consensus estimates are for the 3.4% to continue, with fewer than half the total of news jobs generated in February.
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