Warsh's Hawkish Stance Sends S&P 500 Down 1.2% to 7,420

On June 18, markets sold off sharply after Kevin Warsh's first FOMC meeting emphasized price stability over the rate cuts President Trump had anticipated. The S&P 500 fell 1.2% to 7,420.10 while the Dow dropped more than 500 points, marking the worst first-day performance for a new Fed chair since 1994. Fed funds futures quickly shifted to price in a possible October hike as nine FOMC members projected rates above the current 3.5%-3.75% range by year-end. Warsh also launched five internal task forces to review policy frameworks, adding to investor uncertainty. The episode reversed earlier expectations of easier monetary policy and removed a key support for risk assets.