The S&P 500 Index closed up 0.78% on Wednesday, with the Dow Jones Industrial Average gaining 0.49% and the Nasdaq 100 Index rising 1.51%. In the same trading session, March E-mini S&P futures increased by 0.77%, while March E-mini Nasdaq futures saw a 1.53% rise. These gains were fueled by strong economic indicators, including a February ADP employment increase of 63,000 jobs, exceeding expectations of 50,000, and a significant expansion in the US service economy, which grew at the fastest pace in 3.5 years.
Crude oil prices experienced volatility, with prices rising over 1% amid the closure of the Strait of Hormuz, halting the majority of energy shipments, while Goldman Sachs estimates a real-time risk premium for crude oil at $18 per barrel due to this geopolitical tension. The closure has led to significant stockpiling of crude oil in Gulf producers and an operational shutdown of Iraq’s Rumalia field, further emphasizing the impact of the ongoing Iran conflict on global oil supply.
Additionally, the market is preparing for key economic reports, with expectations of a rise in initial unemployment claims and modest increases in Q4 nonfarm productivity and unit labor costs. The February unemployment rate is projected to remain stable at 4.3%, demonstrating ongoing labor market stability amidst rising inflationary pressures.
