U.S. stock markets ended trading little changed on Friday as investors analyzed the latest comments from U.S. President Donald Trump on the Federal Reserve and geopolitical issues.
The S&P 500 ended the day just below the zero line and posted a weekly decline, while the Nasdaq Composite fell 0.06 percent. The Dow Jones Industrial Average fell by 83 points, or about 0.2 percent.
All three major indexes touched daily lows after Trump said at the White House on Friday that he would prefer National Economic Council Director Kevin Hassett to remain in his current position and may not be selected as the next Fed chairman.
“I actually want you to stay where you are, if you want to know the truth,” Trump said.
Hassett had been seen as one of the frontrunners to succeed current Fed Chairman Jerome Powell, whose term expires in May, but after Trump’s remarks, markets estimated that former Fed Governor Kevin Warsh was now ahead in the race. Traders see Hassett as a more marketable option, while Wall Street expects him to be more willing than Warsh to keep interest rates low.
“Whether it’s Hassett or someone else, I think most of us assume that whoever gets elected will have a political motivation, rather than a traditional, completely independent approach to running the Fed,” said David Krakauer, vice president of portfolio management at Mercer Advisors. “That threat to Fed independence is certainly cause for concern.”
Major indices come after a positive session, boosted by gains in chip stocks. Taiwan Semiconductor led gains after a strong fourth-quarter report. An additional boost to the market was given by the news that the US and Taiwan reached a trade agreement, according to which Taiwanese companies from the chip and technology sector will invest at least $250 billion in production capacity in the United States.
