The Warsh era at the Federal Reserve began with a decisive hawkish tilt — rates were held at 3.50–3.75% but updated projections show nine of 18 officials expect at least one hike this year, with the median dot shifting from a cut to a hike. The S&P 500 fell 1.2% to 7,512.15, the Nasdaq 100 dropped 1%, and the Dow slipped 1% after briefly touching a record 52,002.94 earlier in the session. Two-year Treasury yields surged 17 basis points to 4.216%, their highest since February 2025, while the 10-year rose 7bp to 4.495%. Gold was hit hard, falling 1.9% to $4,247.93 as the stronger dollar — up 0.9% to 100.47 — weighed on non-yielding assets. Oil held relatively steady, with Brent and WTI settling up 1.0% and 0.8% respectively as Strait of Hormuz reopening expectations offset the risk-off mood. ASX futures fell 61 points (0.7%) to 8,892, with investors bracing for the Bank of England, Swiss National Bank and Norges Bank rate decisions today.

Key Takeaways

S&P 500 fell 1.2% to 7,512.15, Nasdaq 100 down 1%, Dow down 1% after briefly touching a record 52,002.94 — sharp late-session selloff on hawkish Fed.

New Fed Chair Warsh held rates at 3.50–3.75% but nine of 18 officials now project a hike this year — money markets price 72% chance of a hike by October.

Brent and WTI settled up 1.0% and 0.8% respectively; gold tumbled 1.9% to $4,247.93 as the surging dollar crushed non-yielding assets.

Two-year Treasury yields spiked 17bp to 4.216% — highest since February 2025 — while the 10-year rose 7bp to 4.495%; dollar index up 0.9% to 100.47.

SpaceX fell for the first time post-IPO after a three-day rally of nearly 50%; market cap briefly topped Amazon and Microsoft to become fourth-largest US listed company near $3 trillion.

ASX futures down 61 points (0.7%) to 8,892; AUD under pressure from surging USD; Bank of England, SNB and Norges Bank rate decisions due today.