A television station broadcasts Kevin Warsh, chairman of the US Federal Reserve, speaking after a Federal Open Market Committee (FOMC) meeting on the floor of the New York Stock Exchange (NYSE) in New York, US, on Wednesday, June 17, 2026.
Michael Nagle | Bloomberg | Getty Images
If the stock market is a report card, Federal Reserve Chairman Kevin Warsh isn’t coming out of his first policy meeting with high marks.
The S&P 500 tumbled 1.2% in Wednesday’s session, with losses steepening during Warsh’s inaugural press conference as chairman.
That marks the worst performance for the broad index on the first “Fed day” under a new chair since 1994, according to Bespoke Investment Group.
The S&P 500, 1-day
To be sure, there have been only three other new Fed leaders named in that timespan: Ben Bernanke, Jerome Powell and Janet Yellen. While those chairs’ first Fed meeting days saw the S&P 500 close lower, none were of the magnitude seen on Wednesday.
Bespoke’s figures go back to 1994 because prior to that year, the central bank did not formally announce its rate target. Greenspan ushered in that practice as chair.
Some investors saw Warsh’s focus on delivering stable price growth as a sign that future interest rate cuts may not be as likely as previously anticipated. The Fed held interest rates steady as the market widely expected on Wednesday — despite the clear push for cuts from President Donald Trump, who nominated Warsh.
“He is absolutely telling you that he plans on delivering on price stability,” DoubleLine Capital CEO Jeffrey Gundlach said on CNBC’s “Closing Bell.” “That means… we’re not going to have such easy money policy as everybody thought maybe Chairman Warsh would do back in the first quarter of this year, when everyone was counting on rate cuts.”
In fact, traders are increasingly expecting the opposite scenario after several Fed officials signaled a possible rate hike this year. Fed funds futures indicate the central bank could raise rates as soon as October now.
The Dow fell 500 points on Wednesday, giving up a gain on the day from before the Fed decision.
Warsh’s Wednesday debut also offered a clear glimpse into how the “regime change” he’s promised for the central bank will look. He significantly pared down the closely followed Fed meeting statement and announced task forces focused on overhauling the central bank’s operations.
— CNBC’s Yun Li contributed to this report.
