Equities rebounded again on Wednesday gaining about 2.0% at the height of the session. The move was driven by better than expected data on the labor front as well as some less-hawkish than expected comments from Jerome Powell. On the labor front, the ADP employment report showed the addition of more than 1.0 million new jobs to the economy when adjusted for revisions. The data is more than double the expectations and points to even tighter labor market conditions than previously thought. The NFP is due out on Friday and could reveal the same information. The risk with the NFP is that wage gains are expected to top 6.0% on a YOY basis and drive consumer-level inflation this year.

Elsewhere in the markets, the price of West Texas Intermediate surged more than 3.0% on Wednesday to above $113 per barrel. This is the highest level for WTI in over a decade and prices are expected to keep rising. Based on the technical outlook, the price of WTI will move above $120 very soon and will be another driving force of inflation this year.