18.06.202615:43 Forex Analysis & Reviews: US Stock Market News Digest on June 18

US stock indices closed with mixed results yesterday

Yesterday's trading in the US stock market ended inconclusively: the S&P 500 and Nasdaq 100 posted losses (down 0.57% and 1.15% respectively), while the Dow Jones rose 0.64%. Bonds and gold are on an uptrend, whereas oil has been falling for the fourth straight day. Brent slipped below $79 per barrel, down roughly 15% over the past four sessions.

The reason is simple: oil falling below $80 eases fears of an inflation shock tied to a potential Strait of Hormuz shutdown. Earlier, when Brent traded above $95 in May, US inflation peaked at 4.2% (the highest since 2023), and the odds of a Fed rate hike by December exceeded 80%. The situation is shifting now, and markets are likely pricing in a scenario where expectations of rate hikes fade as energy-sector inflation eases. More details via the link.

First Fed meeting under Kevin Warsh: takeaways

Kevin Warsh took an unexpected approach. Instead of immediately signalling his stance on interest rates at his first FOMC meeting as chair, he focused on uniting the Committee around a common goal — bringing inflation down to 2%. That led to a unanimous decision, unlike the previous meeting, which had four dissenters.

Differences appeared in the rate forecasts: in June, 9 of the 18 FOMC members expected at least one hike in 2026, while only one projected a cut. Thus, the June meeting marked a clear hawkish turn that has significantly impacted financial markets. It remains unclear, however, whether Warsh personally aligns more with the "doves" or the "hawks." More details via the link.

Gold caught between two forces

At its fourth consecutive meeting chaired by Kevin Warsh, the Federal Reserve unanimously decided to keep the federal funds rate unchanged at 3.50–3.75%. Still, updated projections signal possible policy tightening: nine committee members now forecast at least one rate increase by the end of 2026. The median year-end rate projection rose from 3.4% to 3.8%, reflecting a more hawkish tilt.

These shifts triggered market volatility: gold fell about 1.3% while short-term Treasury yields spiked. Warsh, for his part, declined to offer a personal rate forecast and announced the creation of five new working groups to review Fed operations, telling reporters that it is not possible to provide clear forward guidance on the future policy path. More details via the link.