Wall Street opens on parity, before Federal Reserve Chairman Jerome Powell testifies to Congress. S&P500 (flat), Dow Jones (-0.1%) and Nasdaq (+0.2%) are almost unchanged, with Meta Platforms in the light (+2.1%) thanks to rumors of job cuts.
Treasury yields also showed little change, with the ten-year rate at 3.95% and the two-year rate at 4.88%, while the euro/dollar is down to 1.065.
Powell’s double intervention, scheduled between today and tomorrow, will probably dictate the direction of the markets in the coming days, until Friday’s job report, the other big event this week. The tones of the Fed’s number one could provide indications on the next monetary policy moves in view of the meeting of 21-22 March. Although a 25 basis point rate hike is expected, the door remains open for a more marked hike, by half a percentage point.
Similarly, a still solid reading on the labor market on Friday could justify more tightening measures. At the moment, the markets are pricing in a terminal rate of around 5.4% between July and September.