The first day on a new job is always tough. That goes doubly for Federal Reserve Chair Kevin Warsh who faces the tricky task of tackling inflation concerns and keeping President Donald Trump on side. 

It’s hard not to read symbolic importance into the location of Warsh’s swearing-in as Fed chair on Friday. It’s the first time a central bank official will take the oath of office at the White House in nearly 40 years. Trump has made no secret of his desire for lower interest rates, often cudgelling outgoing chair Jerome Powell for his reluctance to cut borrowing costs. Warsh has pledged to preserve the Fed’s independence. 

But Warsh is taking office just as the data suggest a rate cut is off the table for the foreseeable future. Inflation remains stubbornly high but the labor market is broadly stable. Traders now see a 58% chance of a rate hike by the end of the year, according to the CME FedWatch tool. 

Meanwhile, American consumers are feeling the effects of high oil prices. Walmart warned shoppers are putting less gas in the tank, and it may have to raise prices due to higher fuel costs. Mortgage rates are at their highest level since last August. Home Depot and Lowe’s said this week homeowners are putting off large projects. 

So far, U.S. stock markets have largely looked past the inflation threat, preferring to focus on the artificial-intelligence trade and the promises of space and quantum technologies. But that tranquility depends on a swift resolution to the U.S.-Iran conflict and the reopening of the Strait of Hormuz, which is a risky bet amid conflicting signals from Tehran and Washington. 

Warsh has said he enjoys a “good family fight” when it comes to policy setting, but he might find his most bruising encounters come in the Oval Office if inflation concerns mean he can’t deliver rate cuts.

—Adam Clark

Get more of the journalism you love. Choose Barron’s as a preferred source in Google.

A new era at the Federal Reserve is nearly here, with President Donald Trump due to swear in Kevin Warsh as chair of the central bank at the White House on Friday.

• A Fed chair hasn’t taken the oath of office in the building since Alan Greenspan’s 1987 ceremony during the Reagan administration.

• Trump and Warsh have both voiced support for interest-rate cuts, but it’s unclear if those sentiments will translate into policy. Federal-funds futures are pricing an 84% likelihood that the Fed’s next move will be a rate hike.

• Inflation is still a concern for the central bank, which has missed its 2% inflation target for more than 5 years.

What’s Next: Investors may be bracing for a bumpy Friday: The average S&P 500 return on a new chair’s first day is negative 0.29%, according to Dow Jones Market Data. Oil prices and earnings, however, may make more of a splash with markets than the swearing-in ceremony.

—Nicole Goodkind

SpaceX scrubbed the test of its Starship rocket on Thursday—unfortunate timing, given that the space and AI company’s massive initial public offering is looming.

• A launch window for the 12th test flight of Starship opened on Thursday evening, but the launch was called off just after 7:40 p.m. Eastern time with more than one million people watching. “We’re learning a lot about these systems,” said a company representative on the broadcast.

• The latest test was going to debut version three of the huge launch system, which stands some 408 feet tall, with the booster and upper stage stacked on top of one another. The booster has 33 rocket engines, producing more than 8,000 tons of thrust.

• Starship is designed to cut the cost of reaching orbit by 90% or more. SpaceX’s Falcon 9 rocket has already cut the cost of reaching space by 95% relative to the space shuttle.

• Lower costs for the entire system enable new applications such as orbital AI data centers. CEO Elon Musk believes orbital computing will be cost-competitive with Earth-based computing in a few years. Operating in space is difficult, but there won’t be a power bill paid to a utility.

What’s Next: SpaceX is planning to raise tens of billions of dollars in a June IPO, valuing the company at $2 trillion or more. The money will help kickstart SpaceX’s AI ambitions and provide additional funding for Starship development. SpaceX will try again to launch Starship on Friday.

—Al Root

The U.S. quantum industry got a major vote of confidence on Thursday, when the Commerce Department announced it is planning to award funding to nearly one dozen companies to help develop the domestic quantum industry. Shares of International Business Machines, plus the pure-play quantum companies Rigetti Computing and D-Wave Quantum, closed 12%, 31%, and 33% higher on Thursday, respectively.

• IBM said it would launch “America’s first pure-play quantum foundry,” a standalone company called Anderon, as part of the deal. IBM and the Commerce Department will each contribute $1 billion of cash into Anderon.

• Rigetti and D-Wave have signed letters of intent with the government to each receive $100 million in funding under the 2022 Chips and Science Act. 

• D-Wave will issue $100 million in common stock to the Commerce Department, making the government an equity stakeholder. Rigetti said that the department is looking at taking a similar stake in Rigetti.

• Two privately-owned companies, PsiQuantum and the Honeywell-owned Quantinuum, are set to receive $100 million each under respective agreements with the Commerce Department.

What’s Next: Thursday’s announcement comes as other countries race to be the first to broadly commercialize quantum computing. China is also making progress on the development, though the extent of its effort remains unclear.

—Mackenzie Tatananni

Take-Two Interactive Software investors digested weak guidance from the videogame maker on Thursday, when the company posted fiscal fourth-quarter earnings results.

• The company posted a net loss of $59.5 million, or 32 cents per share, which was narrower than what analysts expected. Fourth-quarter net bookings—the amount of products and services sold digitally or physically—totaled $1.58 billion, beating forecasts. 

• The videogame maker expects fiscal 2027 net bookings to be between $8 billion and $8.2 billion, less than Wall Street’s forecast of $9.13 billion. 

• “More often than not, we do tend to exceed our guidance. We certainly try to outperform expectations,” CEO Strauss Zelnick told Barron’s. “However, initial guidance is intended to be as we see the future.”

What’s Next: Investors and customers have spent years waiting for the release of the sixth installment of the Grand Theft Auto franchise, which has been delayed multiple times. Take-Two on Thursday reiterated its latest release date, Nov. 19, 2026, which would fall in the company’s fiscal third quarter.

—Angela Palumbo

Walmart shares took a beating after the retailer posted first-quarter earnings. Weak guidance overshadowed a revenue beat, with the stock ending Thursday’s session 7.3% lower.

• For the period, the company reported adjusted earnings of 66 cents a share, in line with forecasts, and $177.8 billion in revenue, beating estimates.

• Walmart reiterated its fiscal 2027 outlook. However, it expects second-quarter earnings per share to be 72 cents to 74 cents a share—less than the 75 cents Wall Street was looking for. 

• Walmart posted 5% in first-quarter operating income growth, which factored in a 2.5% drag from rising distribution and fulfillment fuel costs.

• Investors homed in on Walmart’s forecast, due to concerns about the health of the consumer amid high gas prices.