The market is cautious today, mostly waiting to hear the tone that new Fed Kevin Warsh will bring to the table later today.. History says that a new Fed chair often brings volatility to the stock market. No one expects change today, but their views on inflation, employment, AI, and geopolitical risks will carry a lot of weight.

No one forgets that Warsh is Trump’s pick for the job, and Trump has been very clear that he thinks America should have the lowest rates of any country. Warsh will try to establish his independence from political influence.. Expect a significant backlash to his comments today if they are perceived to have either a particularly dovish or hawkish bias. Also of great interest will be his plans to shrink the Fed’s balance sheet.

The Memorandum of Understanding (MoU) between the US and Iran, scheduled to be signed on Friday, when the market closes, has not yet been fully disclosed. Apparently the wild card in the deal is for Israel to stop attacks on Hezbollah in Lebanon, which could derail the ceasefire if violated..

While energy markets are trading as the deal is done, with WTI crude trading below $75/bbl overnight, today It rose above $77 on uncertainty over how viable the truce might be.. Even if things work out as hoped, reserves and distillates have been reduced to decade lows and replenishing them will keep demand above average for several months.

Interest rates are starting to rise modestly, while tech remains positive due to recovery in semiconductors and financial services and industrials. All this could change depending on what Warsh has to say. The trend is positive, and Iran’s relief rally has yet to be fully felt.Pending consensus that the agreement is viable on a long-term basis.