Markets Tumble as Trump Hesitates on Kevin Hassett for Fed Chair Nomination

Stocks across the U.S. equity spectrum registered losses Friday as President Donald Trump expressed hesitation in confirming Kevin Hassett as his nominee for Federal Reserve chair, fueling market volatility. The Dow Jones Industrial Average declined 387 points, or 1.05%, to close at 36,421. The S&P 500 dropped 49 points, or 1.13%, settling at 4,258, while the Nasdaq Composite fell 178 points, or 1.22%, finishing at 14,378. The uncertainty emerged after Trump publicly questioned Hassett’s qualifications during a brief press briefing, despite earlier indications of support. Market participants interpreted the shift as a sign of possible political interference in the independent central bank’s leadership selection, raising concerns about future monetary policy consistency. Historically, Fed chair nominations are treated with high institutional respect, and abrupt reversals can unsettle financial markets. Investors reacted swiftly, with Treasury yields rising across the curve: the 10-year yield climbed to 4.68% from 4.59% the previous day, while two-year yields rose to 4.83%. This move signaled expectations of tighter policy or prolonged rate sensitivity. The VIX volatility index spiked 18% to 22.4, reflecting increased risk aversion among traders. Sector performance reflected broader anxiety: technology stocks led losses, down 1.6% on average, while financials slid 1.3%. Utilities and real estate also declined more than 1%, indicating a flight to safety. Institutional investors began adjusting portfolios ahead of potential policy shifts, with short-term bond positions gaining traction. The episode underscored how political signals—particularly around central banking appointments—can reverberate through global capital markets.