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Trump picks Kevin Warsh as new Fed Chair

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Global stocks fall, still set for weekly gain

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US inflation data hotter than expected

(Updates with U.S. markets OPENING)

By Chuck Mikolajczak

NEW YORK, Jan 30 (Reuters) -

Global stocks declined for a second straight session on

Friday, while the dollar rose, after U.S. President Donald Trump

tapped former Federal Reserve governor Kevin Warsh as the next

chair of the central bank, while a reading on inflation was

stronger than expected.

Warsh is ‌a frequent critic of the Fed and seen as an

advocate of lower interest rates, but also as someone who would

stop well short of the more aggressive easing ​associated with

some other potential nominees. He will take over when Jerome

Powell's term ends in May, if his nomination passes ‍a closely

divided Senate.

"Given his history, he's a hawk in dove's clothing. He's

abundantly qualified and ⁠will likely continue to be an

independent ⁠thinker, not a puppet of the president," said Brian

Jacobsen, chief economist at Annex Wealth Management in

Menomonee Falls, Wisconsin.

"He may want lower rates for now, but not ‌forever. A year

from now, we may hear complaints from the ​White House about

him."

Wall Street stocks were lower in early trading as economic data

showed the Producer Price Index (PPI) for final demand surged

0.5% last month, above the 0.2% estimate of economists polled by

Reuters, after an ⁠unrevised 0.2% gain in November. Businesses

appeared to be passing on ‍higher costs from ​import tariffs.

Also weighing on equities was a decline of nearly 1% in Apple ( AAPL )

after the iPhone maker reported quarterly results.

The Dow Jones Industrial Average fell 114.05 points, or

0.23%, to 48,957.51, the S&P 500 fell 13.92 points, ‍or

0.20%, to 6,955.97 and the Nasdaq Composite fell 53.22

points, or 0.22%, to 23,631.90.

MSCI's gauge of stocks across the globe

fell 3.45 points, or 0.33%, to 1,046.74, but was on track for a

weekly gain and the biggest monthly percentage gain since

September.

The pan-European STOXX 600 index rose 0.77%, holding

gains after Trump's Fed announcement, as strong earnings have

helped propel the index to its biggest monthly gain since May.

The index is also poised for its seventh straight monthly gain,

its longest streak since 2021.

In currencies, the dollar ​was higher ‍in the wake of the

Warsh announcement and inflation data, continuing to show signs

of stabilizing after recent weakness.

The dollar index, which measures the greenback

against a basket of currencies, rose 0.57% to 96.73, with the

euro down 0.54% ​at $1.1904. The dollar was still on track

for a second straight weekly decline and third straight monthly

drop.

Longer-dated U.S. Treasury yields also advanced, with the

yield on the benchmark U.S. 10-year note up 2 basis

points to 4.247%, on track for a third straight weekly gain and

second straight monthly advance. It would be the first

consecutive monthly gains since early 2024.

The strength in the dollar helped cool the recent rally in

gold. The metal

briefly dropped back

below $5,000 after hitting a record of nearly $5,600 on

Thursday. Spot gold was last down 6.43% to $5,046.49 an

ounce, but set for a fourth straight ​weekly advance. It has

rallied about 17% in January, its strongest monthly performance

since August 1982.

U.S. crude rose 0.17% to $65.53 a barrel and Brent

rose to $70.74 per barrel, up 0.04% on the day, after

Trump said on Thursday he was planning to speak with Iran's

leaders, even as the Pentagon prepared for possible military

strikes.