Markets falter after Fed Chairman Powell finishes his testimony

9:38 a.m. ET, March 8, 2023

Stocks open higher ahead of more testimony from Powell

From CNN’s Nicole Goodkind

The New York Stock Exchange on March 7.

(Spencer Platt/Getty Images)

US stocks opened slightly higher on Wednesday as investors struggled for direction after comments Tuesday from Federal Reserve Chairman Jerome Powell about inflation data and the state of the economy sparked a market sell-off.

Powell sent markets lower and 2-year Treasury yields to a 15-year high on Tuesday as he opened the door to bigger rate hikes during testimony before the Senate Banking Committee.

Richmond Fed President Thomas Barkin was concerned Wednesday morning. High inflation means the Federal Reserve has more work to do, he said at an event in South Carolina.

Chairman Powell is expected to testify before the House Financial Services Committee at 10 a.m. ET on Wednesday, potentially triggering another wave of market volatility.

Meanwhile, the bond market is sending a warning signal that generally predicts an approaching recession: The yield on the two-year US Treasury has risen the most in more than 40 years than the 10-year. That is a signal that investors are more nervous about the near future than the longer term.

Tensions between the United States and China also continue, worrying investors. China has announced a sweeping government reform that aims to boost its technological self-reliance as the tech war with the United States intensifies.

The ADP employment report, meanwhile, pointed to a still resilient US labor market, adding 242,000 jobs in February. That’s well above the estimates of 200,000 and more than double the revised 119,000 jobs in January.

Investors await US job posting numbers for January at 10 a.m. ET and government payroll numbers on Friday.

In company news, shares of Occidental Petroleum rose 3.3% after documents showed Warren Buffett’s Berkshire Hathaway bought more shares of the energy company this week. Shares of Stitch Fix, meanwhile, fell nearly 10% after the apparel company missed estimates on fourth-quarter earnings.

The Dow Jones was up 36 points, or 0.1%, on Wednesday morning.

The S&P 500 grew 0.1%.

The Nasdaq Composite was up 0.2%.






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