U.S. stocks ended the week with broad gains as the S&P 500 posted its longest weekly winning streak since 2023, while the Dow Jones Industrial Average climbed to a record high. The move came as investors digested a mix of market optimism and fresh attention on the Federal Reserve after Kevin Warsh was sworn in as Fed chair.
Warsh began a four-year term leading the central bank after President Trump administered the oath in the White House’s East Room. He was already confirmed by the Senate for a 14-year term as a governor, giving him a central role as monetary policy faces renewed pressure from inflation and a steadier labor market.
Markets react to policy uncertainty
Wall Street has been watching how the Fed will navigate a more complicated backdrop after the war in Iran and the resulting oil price shock helped revive inflation concerns. At the same time, a stabilized labor market has made rate cuts less likely this year, leaving investors to assess how long the current economic balance can last.
That policy uncertainty adds to the attention around the central bank’s leadership change. Trump said he wanted an independent Federal Reserve and told Warsh, “Don’t look at me, don’t look at anybody, just do your own thing and do a great job.”
Warsh takes over amid scrutiny of the Fed
Warsh enters the role after years of political tension around the central bank’s independence. Trump had repeatedly criticized former Fed Chair Jerome Powell on social media and also tried to remove a Fed official, keeping the institution under intense public scrutiny.
Those concerns resurfaced this year when the Department of Justice opened a probe into the Fed and Powell before later withdrawing it. Powell’s term as chair ended on May 15, although he will remain on the board of governors.
What Warsh said on taking office
In his remarks, Warsh signaled that his leadership would focus on reform and discipline rather than rigid policy thinking. “I will lead a reform-oriented Federal Reserve,” he said, adding that the central bank should learn from “past successes and mistakes” while avoiding “static frameworks and models.”
That message lands at a time when investors are looking for clarity on inflation, interest rates, and the Fed’s next moves. For markets, the combination of a record-setting Dow, a multi-week S&P 500 advance, and a new Fed chair underscores how closely stock performance remains tied to the central bank’s direction.
