The F.O.M.C. released the minutes of its February meeting. The minutes revealed what everyone figured: no rate hike is expected. They said that “measures of consumer and business sentiment have improved lately; there is moderate economic growth along with some further strengthening in the labor market; there has been a move to their target of 2% inflation”. This is evidenced by the 1.7% advance in the core CPI in 2016.

Today’s market basically didn’t know what it wanted to do. It fluctuated in narrow ranges ahead of tonight’s earnings report from AMZN and tomorrow’s important non-farm payroll report. The DOW and the NASDAQ each lost 6 points today while the S&P 500 eked out a 1 point gain.  

Today’s weekly jobless claims declined by 16,000 down to 246,000 but this is not the survey week that will be used for tomorrow’s jobs number.

The Holy Grail of FB was actually lower today after its strong report. It traded higher all last evening and early this morning. So what happened? The good news was already discounted in the stock as it made new all-time highs ahead of its report. In addition, there is always the interest in punishing those who bought options ahead of an earnings report, particularly the upside calls as we have already seen with NFLX and GOOG. Other stocks moving on earnings to the downside were DB, RL, R, CRUS and JCI. On the upward swing were CTXS and PM.

Breadth numbers were slightly positive at a 16/15 upside ratio and the VIX was up 1% to 11.93. Bond yields were lower with the 10-year now at 2.45% due to the ongoing fears of the President’s protectionist leanings which might lead to trade wars. The dollar is lower again to a seven-week low. The Euro was up to 1.078. Gold fell to $1,216 an ounce. Crude oil climbed to $53.81 a barrel which is near the top end of its recent range. 

All eyes will be on tomorrow’s jobs report. If it comes out too high…near what ADP said yesterday at 246,000…this could be negative for the markets. It would show that the Fed could be more aggressive in raising rates making the dollar stronger again…thereby hurting the multinationals. A number that comes in far below the 175,000 consensus might show that the economic recovery has hit an upside wall. Stay tuned.

Donald M. Selkin

These are excerpts from Don Selkin’s Daily Market notes, abbreviated and updated with permission from the author. Don Selkin is the Chief Market Strategist at Newbridge Securities Corporation, member FINRA/SIPC and provides the Fair Value analysis for CNBC each morning.  The commentary provided in this Market Letter is intended to provide our customers with timely market analysis and should not be considered a research report.  This Market Letter may contain, and is limited to: Discussions of broad based indices; Commentaries on economic, political or market conditions; Technical analyses concerning the demand and supply for a sector, index or industry based in trading volume and price; Statistical summaries of multiple companies’ financial data, including listings of current ratings; and, Recommendations regarding increasing or decreasing holdings in particular industries or securities.  This Market Letter does not make a financial or investment recommendation or otherwise promotes a product or service of the firm.   This Market Letter contains only news, facts, and commentary on information previously reported from a news source believed to be accurate and reliable by the author.  These news sources include the following: Bloomberg Financial, Reuters, and the Associated Press.