Stock Market Today: Stocks higher on Powell comments after muted jobs report
The S&P 500 is on pace for its worst week since September.
U.S. stocks turned higher in late Friday trading, while the dollar extended its steepest weekly decline of the year, as investors parsed a key reading of the labor market amid the ongoing confusion tied to President Donald Trump's tariff strategy.
Updated at 12:57 PM EST
No hurry
Federal Reserve Chairman Jerome Powell echoed the market's concern over "uncertainty" tied to tariff and economic policies, but noted that solid labor markets and easing inflation pressures likely mean the central bank remains in "no hurry" to change its key policy rate.
Speaking to a forum on monetary policy in New York, hosted by the University of Chicago Booth School of Business, Powell said that while the economic outlook is now clouded by uncertainty, much of the impact has been seen in sentiment surveys, which he stressed have "not always been a good predictor of consumption growth".
"We do not need to be in a hurry, and are well positioned to wait for greater clarity," Powell said.
Stocks are still in the red, but have pared some of their earlier declines into the afternoon session, with the S&P 500 down 5 points and the Nasdaq off 20 points.
Fed's Powell's Speech on Economic Outlook https://t.co/mIcxJh7wIA— FinancialJuice (@financialjuice) March 7, 2025
Updated at 11:13 AM EST
Getting out the calculators
Goldman Sachs followed Wall Street rival JPMorgan in lowering its first quarter GDP growth estimate this week, pegging a likely advance of around 1.7% to reflect what it called "new tariff assumptions" for the world's biggest economy.
“While our previous tariff assumptions implied a peak hit to year-on-year GDP growth of -0.3 percentage points, our new assumptions imply a peak hit of -0.8 percentage point. In the risk scenario, this would grow to -1.3 percentage points,” Goldman said.
"Taking on board this additional 0.5 percentage point drag on growth from our new larger tariff assumptions, we have reduced our 2025 Q4/Q4 GDP growth forecast to 1.7%, from 2.2% previously," the bank added said. "This implies that GDP growth will be slightly below potential rather than slightly above.“
Tariff forecast and its impact on the GDP.
-Goldman Sachs pic.twitter.com/hcjzz3u5aS— THE SHORT BEAR (@TheShortBear) March 7, 2025
Updated at 10:07 AM EST
Volatility watch
The market's closely-tracked volatility index, the CBOE Group's VIX, eased moderately into the early session but remains elevated at the highest levels since early December.
At $24.05, the VIX indicates options traders are expecting daily swings of the S&P 500 of around 1.5%, or 86 points, for each day over the next month.
"We’ve felt whipsawed by the on-again off-again tariff news, but we’ve largely held the same course as we began 2025 with: very cautious, risk-off and concerned about valuations and concentration," said Chris Zaccarelli, CIO at Northlight Asset Management.
"We’ve been counseling clients since the end of last year that 2025 was likely to be a volatile year because of policy uncertainty and so far, that’s exactly what we’ve seen," he added.
31 one-day $VIX implies a 2% SPX move today pic.twitter.com/62AATbKPTG— Mike Zaccardi, CFA, CMT
