The S&P 500 (Index: SPX) had a remarkably subdued week compared to other markets. The U.S. stock market index hit a new record high close of 6,978.59 on Tuesday, 27 January 2026, but went on to retreat about 0.4% from that high to end the week at 6,939.03 at the close of trading on Friday, 30 January 2026, which was a little over 0.3% below where it ended the previous week.
Most of the S&P 500's decline took place on Friday, 30 January and was relatively muted compared to what happened with gold and silver, which dropped by 9.1% and 26% respectively.
All three markets were affected by investors' reaction to President Donald Trump's announcement he would appoint Kevin Warsh to be the next Chair of the Federal Reserve. The appointment of Warsh, who is perceived as an inflation hawk based on his previous stint at the Fed, affirmed investors the Fed's independence was not at risk. That in turn sparked the large drops in the precious metals as a "safe-haven" hedge.
Meanwhile, Warsh's appointment left investor expectations for what will happen with U.S. interest rates in 2026 unchanged. The CME Group's FedWatch Tool continues to project the Fed will hold the Federal Funds Rate steady until 17 June (2026-Q2), when it anticipates a quarter point rate cut. The tool forecasts a better than 50% chance of another quarter point reduction on 28 October (2026-Q4). Had President Trump nominated a different candidate, the probabilities of more and larger rate cuts would likely have increased.
All this leaves the S&P 500's trajectory consistent with the level the dividend futures-based model sets for investors focusing on the future quarter of 2026-Q2.
Here are more of the market moving news headlines that influenced investor expectations during the week that was.
- Monday, 26 January 2026
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- Signs and portents for the U.S. economy:
- Winter storm snarls US travel, forces mass flight cancellations
- Oil prices rise as harsh winter disrupts US output
- Bigger trouble, stimulus developing in China:
- Chinese automakers and government discuss chip shortage and exports
- China pledges policy support for beef and dairy sectors
- BOJ minions getting set to keep Japan's currency from collapsing:
- BOJ sees boost to inflation from weak yen becoming larger
- Yen hits over two-month high, markets on alert for intervention
- ECB minions developing intricate plan to not do much:
- Wall Street indexes close higher ahead of earnings, Fed meeting
- Tuesday, 27 January 2026
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- Signs and portents for the U.S. economy:
- Oil holds steady as US storm disruption offset by Kazakhstan restart
- US core capital goods orders rise for fifth straight month, boosting economic outlook
- US single-family home prices jump in November, FHFA says
- Bigger profits developing on paper in China:
- BOJ minions / Bigger trouble developing in Japan:
- Bigger trouble developing in Eurozone:
- S&P 500 closes at new record as investors await big tech earnings, Fed decision
- Wednesday, 28 January 2026
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- Signs and portents for the U.S. economy:
- Oil prices hover around four-month high, buoyed by weak dollar and US storm
- Trump says value of the dollar is 'great', currency hits 4-year low
- Fed minions hold U.S. interest rates steady, as expected:
- Fed expected to hold rates steady as rate-cut pause begins
- Fed leaves rates unchanged, sees 'elevated' inflation and stabilizing job market
- Key quotes from Fed Chair Powell's news conference
- For Fed, uptick in bank lending may add to case against rate cuts
- Fed almost incidental to market swirl
- Trump predicts interest rates will come down after he announces Fed chair pick
- Bigger trouble developing in China:
- Chinese buyers and sellers expect gold rush to continue despite record prices
- China soaks up the crude oil glut, but only if the price is right
- BOJ minions thinking about when to hike Japan's interest rates again, also thinking about acting to bail out Japan's currency:
- Weak yen, labour crunch key to BOJ rate hike timing, minutes show
- Japan may hold off on yen intervention for now, ex-BOJ official says
- Bigger trouble developing in the Eurozone, ECB minions starting to worry about value of Euro:
- Germany cuts growth forecasts amid slow recovery
- ECB would need to act if euro keeps gaining, says Austria’s central bank governor
- Markets see ‘boring’ reaction to Fed’s pause with U.S. stocks flat
- Thursday, 29 January 2026
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- Signs and portents for the U.S. economy:
- Brent crude tops $70 per barrel on Iran attack concerns
- US factory orders rebound in November on commercial aircraft demand
- Fed minions expected to cut rates later rather than sooner,
- Bigger stimulus developing in China:
- Bigger trouble developing in Japan:
- S&P 500, Nasdaq close down as Big Tech's soaring AI budgets trigger flight
- Friday, 30 January 2026
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- Signs and portents for the U.S. economy:
- Oil forceast to hover near $60/bbl, as oversupply outweighs geopolitical risks
- US producer prices rose 0.5% in December, more than expected, on uptick in services inflation
- Fed minions find out who their new boss will be, divided on whether and when to cut U.S. interest rates next:
- Trump taps ex-Fed insider Warsh to lead world's top central bank
- Five things to know about Kevin Warsh, Trump's 'central casting' Fed chair pick
- Fed's Miran assumes Warsh will fill his governor slot at central bank - CNBC
- Fed's Musalem says no more rate cuts needed with policy now at neutral level
- Fed's Bowman still supports rate cuts despite backing pause at recent meeting
- Bigger trouble, insurer bailout developing in China:
- China logs first fiscal revenue drop since 2020 on property slump, weak consumption
- China's surging exports a sign of global metals turmoil
- China's factory activity expected to stall at start of new year: Reuters poll
- China plans $29 billion special bonds to recapitalise insurers, Bloomberg News reports
- BOJ minions counting on jawboning to keep Japan's yen from crashing, get better inflation data:
- Japan's FX market intervention limited to verbal warnings, MoF data shows
- Core inflation in Tokyo slows, still on track to hit BOJ goal
- U.S. stocks end the week in the red as tech sell-off deepens
The Atlanta Fed's GDPNow toolestimate of real GDP growth in the U.S. during 2025-Q4 gained a tick, rising to +5.4% from the +5.3% growth it projected a week earlier.
Image credit: Microsoft Copilot Designer. Prompt: "An editorial cartoon of a Wall Street bull and bear who are both wearing suits attending a press conference in which the next candidate to be the Chair of the Federal Reserve is being introduced. The bear asks 'So what's this guy going to do when he gets the job?’"