S&P 500 Braces for Worst-Case Plunge on May 15 as Hawkish Warsh Looms Amid Inflation Surge

Wall Street warnings escalate over a potential S&P 500 downturn on May 15, when Jerome Powell's Fed chair term ends and hawkish Kevin Warsh—nominated January 30—is poised to take over and shrink the $6.7 trillion balance sheet. This coincides with trailing-12-month U.S. inflation jumping 90 basis points to 3.3% in March and an estimated 3.58% for April, fueled by a seven-week Strait of Hormuz closure disrupting 20% of global oil flows. Higher yields from policy tightening and supply shocks threaten valuations that priced in 2026 rate cuts, heightening downside risks for the index.