The damage from Fed Chair Kevin Warsh‘s first post-hike press conference was not evenly distributed.
With the dot plot showing an additional rate hike and higher inflation projections, the selling concentrated in exactly the places a higher-for-longer rate path hurts most.
Alternative asset managers and capital-markets names took an outsized hit.
10 Stocks Falling The Most After Warsh’s Press Conference
According to Benzinga Pro data, these were the 10 names with the highest drops in the hour following Warsh’s press conference.
ON Semiconductor Corp. (NASDAQ:ON) led all decliners, down 6%, and the Direxion Daily Semiconductor Bull 3X Shares (NYSE:SOXL) — the triple-leveraged chip fund — magnified the unwind, down 4.9%, after the group spent the morning ripping higher on an oversold optics bounce.
Nebius Group N.V. (NASDAQ:NBIS) fell alongside it.
Rate-sensitive consumer names were not spared.
Somnigroup International Inc. (NYSE:SGI) and Carvana Co. (NYSE:CVNA) both slid more than 3.5% on a day when the average 30-year mortgage rate printed 6.97%, its highest since May 2025. The Boeing Co. (NYSE:BA) was among the Dow’s heaviest drags.
And Coeur Mining Inc. (NYSE:CDE) tracked the metals reversal, with gold round-tripping from up 1.4% before the decision to down 1.4% at $4,285 an ounce as the dollar index pushed toward 100.
The Carlyle Group Inc. (NASDAQ:CG), Invesco Ltd. (NYSE:IVZ), Jefferies Financial Group Inc. (NYSE:JEF) and Ares Management Corp. (NYSE:ARES) all shed more than 3.5%.
| Name | Price | % change |
|---|---|---|
| ON Semiconductor | $67.39 | -6.02% |
| Somnigroup International | $62.90 | -4.86% |
| Direxion Daily Semiconductor Bull 3X Shares | $101.55 | -4.53% |
| The Carlyle Group | $39.24 | -4.04% |
| Invesco | $29.61 | -3.71% |
| Boeing | $197.66 | -3.70% |
| Nebius Group | $208.63 | -3.64% |
| Carvana | $64.94 | -3.63% |
| Coeur Mining | $18.50 | -3.63% |
| Jefferies Financial Group | $46.95 | -3.60% |
Economists Split On What Comes Next
The sell-side read the same projections and reached opposite conclusions about how long this lasts.
Jeffrey Roach, chief economist at LPL Financial, called the outcome “more hawkish than expected,” saying the updated forecasts imply another hike is coming later this year.
“If the economy keeps up like it has, the Fed is telling us that we may not see a cut until 2028,” he wrote, adding that Warsh and the committee are “building a strong reputation through their laser focus on defeating inflation.”
Samuel Tombs, chief U.S. economist at Pantheon Macroeconomics, provided the details below the median.
Sixteen of the 18 participants who submitted forecasts expect to tighten again before year-end, he noted — 12 looking for one more 25-basis-point move and four for a full 50 basis points.
Warsh confirmed that he again refrained from submitting a dot of his own.
“The extent of the hawkish pivot is surprising, given relatively little movement in the Committee’s median forecasts for core PCE inflation, GDP growth or the unemployment rate,” Tombs wrote.
“This suggests many participants feel pressure from markets to prove their inflation-fighting credentials.”
He still expects 75 basis points of easing next year beginning in June, arguing that slowing wage growth, a fading fiscal impulse and higher long-term borrowing costs will change minds.
Michael Pearce, chief U.S. economist at Oxford Economics, read the projections as risk management rather than the opening of a cycle. He expects one additional 25-basis-point hike this year before falling inflation moves the Fed to the sidelines.
“We don’t think this is the beginning of another major tightening cycle and markets have too much tightening priced in over the coming year,” Pearce said, flagging that several participants raised their neutral rate estimates — meaning policy was never as tight as they had assumed.
Chris Zaccarelli, chief investment officer at Northlight Asset Management, framed the decision as unavoidable.
With inflation above target for more than five years and consumer spending resilient, “the Fed was boxed into a corner and needed to raise rates in order to begin fighting inflation, even if the labor market eventually weakens as a result.”
He credited Warsh with threading the needle by hiking without committing to what follows, and expects the Fed to skip meetings rather than move consecutively.
Image created using artificial intelligence via Midjourney.
