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Investing.com – Stocks roared right back on Wednesday, rallying 2% as Federal Reserve Chairman Jerome Powell told Congress he was inclined to raise interest rates at a steady pace.
The Fed is expected to start raising rates when it meets this month as it tries to battle inflation. Powell’s testimony to the House Financial Services Committee seems to have been the balm investors needed after being rattled by the war in Ukraine and fears of big rate increases.
Instead, Powell told Congress he was looking at a quarter-point increase. In recent weeks some have anticipated a half-point hike.
The remarks come a day after President Joe Biden delivered his first official State of the Union address, condemning Russian President Vladimir Putin for Russia’s aggression in Ukraine while at the same time vowing to press ahead with measures intended to fight inflation.
Biden wants Congress to embrace many of the same proposals that were part of his Build Back Better social spending and climate change initiative. He urged Congress to go after lowering prescription drug prices and making child care more affordable.
He also championed his infrastructure spending on roads, bridges and other transportation. Biden was in Wisconsin on Wednesday to highlight that part of his agenda, which was enacted last year.
Oil prices spiked again, with the price of U.S. benchmark West Texas Intermediate rising to levels it hasn’t reached since 2011.
Here are three things that could affect markets tomorrow:
1. Jobless claims
The weekly jobless claims report is due out at 8:30 AM ET. It comes a day after the ADP private payroll report for February showed companies hired more workers than expected, an indication the economy is on good footing. Private payrolls increased by 475,000 jobs last month. Economists polled by Reuters forecast an increase of 388,000 jobs.
2. Costco earnings
Costco Wholesale Corp (NASDAQ:COST), the membership-only big-box retail store company, is set to announce its earnings after the bell Thursday. Analysts polled by Investing.com have forecast earnings per share at $2.75 on revenue of $51.35 billion.
3. Chip earnings
Broadcom Inc (NASDAQ:AVGO), the semiconductor and infrastructure software product firm, is also set to post earnings after the close, with analysts forecasting earnings per share of $8.13 on revenue of $7.61 billion.
