Federal Reserve Chair Jerome Powell said in a speech that the Fed will wait for clearer evidence of lower inflation before cutting interest rates. He reiterated that rates will likely be lowered "at some point this year" but said it's too soon to say if the recent inflation report reflects more than just short-term bumps. Powell reinforced that the Fed's moves will depend on incoming data and that they have time to let data guide their decisions given the strength of the economy. He suggested a rate cut is unlikely at the next Fed meeting in late April/early May while maintaining the Fed's independence from political influence as elections come close, stating their analysis is "free from any personal or political bias."


The S&P 500 and Nasdaq closed higher on Wednesday, with the energy sector leading gains on higher oil and the energy index setting a new record closing high. Intel fell after disclosing steep losses in its foundry business, while Ulta Beauty crashed 15% on the comment of lower consumer spending in beauty product while expecting lower growth.


Gold prices are continuing to make new highs for the seventh consecutive day, complimented by a lower dollar after Powell's dovish comments. The upcoming U.S. jobs report puts certain investors in a position to hedge ahead of the data, viewing a softer labour market as a catalyst for early rate cuts. Technically, pullbacks have been getting smaller, and trends might reverse in the near term.


Crude prices climbed to their highest levels since October, although the OPEC+ group's decision to keep production cuts in place was offset by a jump in U.S. crude stockpiles. The market also took into account the positive economic cues from China, the world's top oil importer, which could support higher demand.


The dollar traded lower as investors awaited U.S. labour data for guidance on rate outlook. The yen continued its descent against major currencies, nearing intervention levels versus the dollar. Volatility gauges crept higher ahead of the jobs report as central banks face inflationary pressures from the recent commodity surge, potentially complicating rate cut plans.