The review of the US stock market for March 5, 2021

Yesterday, the major US stock indices lost approximately 1-2%.

On agenda:

The US stock market is under pressure amid an increase in yields on government bonds. On top of that, Fed's Chair Jerome Powell admitted the fact that the inflation rate in the US has accelerated.

The main US stock indices have dropped for three consecutive sessions. The plunge followed an increase in yields on Treasures. Apart from that, a deeper correction is needed due to an overbought status of the market.

There are two key factors that influence the US stock market. The first one is the large-scale $1.9 trillion rescue plan, which accounts for approximately 10% of the country's GDP. The second one is the overbought status on the US stock market, extremely high prices, and a clear slowdown in the US labor market.

The US Labor Department report is set for release today. Total nonfarm employment is expected to advance by 170K. Meanwhile, the reports of the last couple of weeks reflect a clear slowdown in the US labor market as well as no change in the 6.4% unemployment rate. The number of continuing jobless claims is projected to be 4.3 million, while initial claims are estimated to rise by 730K.

The S&P 500 lost 0.2%.

Oil settles higher (CL futures contract)

Brent set another record high of $89 per barrel, the level unseen for over a year. Oil prices jumped after yesterday's OPEC meeting. The cartel decided to keep production largely steady despite an improvement in the global economy amid a decrease in COVID-19 cases. Only Russia and Kazakhstan will be allowed to rise production by approximately 150,000 barrels per day.