Data released on Wednesday did little to ease concerns about higher rates as it showed that U.S. private payrolls increased more than expected in February. Also, the U.S. jobs report showed openings decreased to 10.8 million in January compared with economists' expectations for 10.5 million, and data for the prior month was revised higher. Layoffs rose in January and 2022 job cuts were higher than initially thought while fewer people quit their jobs. "Investors are digesting Fed Chair Powell's testimony to Congress and data indicating that the job market remains pretty hot," said Tom Hainlin, national investment strategist at U.S. Bank Wealth Management, in Minneapolis. Hainlin sees Friday's non-farm payroll report and next week's inflation readings for February as keys to whether the next rate hike will be 25 or 50 basis points.
Traders kept increasing bets for a Fed rate hike of 50 basis points later this month, with fed funds futures recently showing a roughly 80% chance for such a hike, up from about 70% on Tuesday and 31% on Monday before Powell's first testimony, according to CME Group's FedWatch tool.
According to preliminary data, the S&P 500 gained 5.54 points, or 0.14%, to end at 3,991.91 points, while the Nasdaq Composite gained 46.76 points, or 0.41%, to 11,577.10. The Dow Jones Industrial Average fell 62.15 points, or 0.19%, to 32,794.31.
Tesla Inc slid after the U.S. auto safety regulator said it was opening a preliminary investigation into 120,000 Model Y 2023 vehicles following reports about steering wheels falling off while driving. Occidental Petroleum Corp gained after Warren Buffett's Berkshire Hathaway Inc increased its stake in the oil company to about 22.2%. <^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^ Odds surge for larger Fed rate hike in March Odds surge for larger Fed rate hike in March ^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^> (Reporting by Sinéad Carew in New York, Shristi Achar A, Sruthi Shankar and Bansari Mayur Kamdar in Bengaluru, graphic by Noel Randewich, additional reporting by Amruta Khandekar Editing by Vinay Dwivedi, Sriraj Kalluvia and Richard Chang)
