Day Traders Diary

3/8/23

The major averages closed mixed as traders processed fresh job market data and further comments from Federal Reserve Chairman Jerome Powell talking to Congress for a second day. The Dow Jones Industrial Average fell 58 points or 0.02%. The S&P 500 rose 5 points while the Nasdaq rose 45 points.

These mixed results came after new numbers on the job market led investors to believe that higher rate hikes are more likely. Stronger-than-expected private payrolls numbers for February reaffirmed the strength of the economy. Powell reiterated his warning message to lawmakers that the central bank may raise interest rates higher than previously anticipated. However, he emphasized that no decision has been made yet regarding the March meeting.

The market is finally coming to the realization that elevated interest rates are here to stay and the idea of a Fed pivot anytime soon is wishful thinking," Main Street Research's chief investment officer James Demmert said on Thursday.

"The global economy is more resilient than many realized, which will make inflation stickier and is extending central bankers' terminal rate target. Inflation has come down but is nowhere near the Fed's 2% target, so there is much work to be done given the stubborn strength of the economy and wage inflation," he added.

BJ's Wholesale and JD.com are set to report earnings Thursday. Investors will be also looking at the jobless claims report, which is due at 8:30 a.m. ET. Federal Reserve Vice Chair for Supervision Michael Barr is also scheduled to speak on cryptocurrencies.