NEW YORK, Aug. 29 -- Options traders spent Friday repricing the September Federal Reserve meeting, not because anything changed at the Fed, but because Kevin Warsh said something that changed the math.

The Fed chair's address at the Kansas City Fed's annual Jackson Hole symposium delivered a clearer warning than markets had anticipated. Warsh said inflation had cooled "a bit" but that underlying trends had not "meaningfully improved" - language traders read as a door left open for a rate hike as early as September. The CME FedWatch index moved fast: by midday, 57% of futures traders priced in a 25-basis-point hike at the Sept. 15-16 FOMC meeting, up from roughly one-third before Warsh spoke, according to Fortune.

The S&P 500 closed at 7...