Eight Weeks and a New Fed Chair

The S&P 500 posts its eighth consecutive weekly gain. Kevin Warsh is sworn in at the White House. Dell surges 30% in a single session. Iran peace talks put oil below $100. A week that moved fast and left several important questions open.

There was a moment on Friday morning, roughly 10 a.m. Eastern, when the East Room of the White House and the floor of the New York Stock Exchange were both hosting ceremonies that will shape the next several years of American financial markets. In the East Room, Kevin Warsh took the oath as Chairman of the Federal Reserve — the first Fed chair sworn in at the White House since Alan Greenspan in 1987, a historical footnote that captured, in miniature, the current administration's unambiguous posture toward the central bank it spent two years lobbying to reshape. On the trading floor and across terminals, Dell Technologies was up nearly 30% on the strength of an earnings report that hit after Thursday's close, pulling every AI-adjacent hardware name with it in a sympathy wave that eventually carried the Dow to yet another record close. The S&P 500 closed the week at 7,473, notching its eighth consecutive weekly gain and its seventh consecutive winning session.

The Week, Day by Day

Warsh Takes the Oath

Kevin Warsh is now the Chairman of the Federal Reserve, sworn in at 10 a.m. Friday morning in the East Room of the White House. The setting was itself a statement. No Fed chair has been sworn in at the White House since Alan Greenspan in 1987. President Trump opened the ceremony by telling Warsh to "be totally independent" — while simultaneously standing at the podium for an administration that has spent two years publicly criticizing the central bank's interest rate decisions and orchestrating the nomination of a successor who has been more publicly sympathetic to lower rates than Powell ever was.

The market's reaction to Warsh's installation has been more measured than either bulls or bears anticipated. There was no "Warsh rally" on the day of his Senate confirmation, and there hasn't been a dramatic repricing of rate cut expectations on the day of his swearing-in either. The reason is straightforward: Warsh now takes the chair at a moment when headline PCE sits at 4% year-over-year and core PCE is running at 3%, both materially above the Fed's 2% mandate. He built his entire public career criticizing the Fed for falling behind on inflation. He cannot arrive as Chairman and pivot dovishly while the data reads the way it does. Markets appear to understand this, which is why the 10-year yield remains in the 4.4–4.5% range rather than collapsing on the assumption of imminent cuts.

What Warsh's arrival does change is the communication style and the institutional tone. He is a more market-attentive Fed chair than Powell in his later years — someone who will be watching the tape as well as the data. Whether that makes him more or less predictable remains the central question for rate markets as the summer unfolds.

Week's Notable Movers

Oil and Diplomacy: Sub-$100 and Still Moving

For the first time since the Strait of Hormuz disruption began, WTI crude spent meaningful time below $100 per barrel this week. The driver was a combination of genuine diplomatic progress — Pakistan brokering indirect talks, Secretary Rubio engaged in Islamabad on Friday — and Trump's "final stages" language on Tuesday that gave traders permission to begin unwinding the conflict premium embedded in crude prices since March.

The significance of oil below $100 for financial markets should not be understated. At $110–$115, the oil shock becomes a direct input into everything: CPI, PCE, airline margins, trucking costs, consumer discretionary spending. Below $100, those pressures moderate. They don't disappear — gasoline prices at the pump this Memorial Day weekend are still running 28% above year-ago levels — but they begin to turn, and turning commodity prices are what give the Fed the optionality to pause rather than hike.

The complication is that the uranium directive headline on Tuesday reminded everyone how quickly the diplomatic backdrop can reverse. Markets are not yet pricing a full ceasefire — they're pricing a higher probability of one. That's different. If talks collapse over the weekend, oil is back above $100 before the Monday open.

What Warsh Inherits: The Numbers

It is worth being precise about the macroeconomic environment Kevin Warsh steps into. Headline PCE inflation is running at 4% year-over-year. Core PCE is at 3%. The University of Michigan consumer sentiment index fell to 49.8 in April — deep in recessionary territory. Wage growth is running at approximately 3%, meaning real wages are negative against current price levels. Gasoline is up 28% from a year ago. Beef is up 16%. The 30-year Treasury yield is near 5.1%. Markets are pricing roughly a 60% probability of a rate hike at the December 2026 meeting — not a cut.

This is the classic stagflation configuration: growth slowing, prices not. The equity market's eight consecutive weekly gains tell one story; the bond market's refusal to rally tells another. Both can be right simultaneously — equities can rally on earnings momentum while bonds price an inflation problem that equities are temporarily ignoring. The question is which one breaks first, and that question now lands on Warsh's desk with his first morning briefing on Monday.