1. Waller emerges as a candidate to replace Powell as Fed Chair. 2. Trump criticizes Powell for not cutting interest rates. 3. Waller dissented against maintaining current interest rates. 4. Waller opposes labor market deterioration, advocating for an interest-rate cut. 5. White House is interviewing candidates for another Fed vacancy.
Waller's potential chairmanship could signal more accommodative monetary policies, similar to previous Fed shifts that supported equities and S&P 500 growth. Historically, lower interest rates strengthen equity markets, as seen during past Fed rate cuts.
Monetary policy changes directly impact sectors represented in the S&P 500, influencing investor sentiment and spending. An accommodating Fed chair like Waller could boost risk assets, especially equities.
The immediate market sentiment would be affected by Waller's potential chairmanship, especially with looming interest rate discussions. Short-term impacts have been observed when Fed leadership changes pointed towards more dovish policies.