US equities edged higher overnight despite fresh turmoil from Washington after President Trump intensified his attacks on the Federal Reserve by sacking Governor Lisa Cook.
- Dow Jones finished +0.30% at 45,410
- S&P 500 gained +0.41% to 6,465
- Nasdaq added +0.44% to 21,544
The dollar and Treasury yields slipped as investors sought safety:
- DXY fell -0.20% to 98.24
- 2-year yield dropped 4.5bps to 3.679%
- 10-year yield eased 1.4bps to 4.261%
In commodities, oil retreated after recent gains while gold benefited from safe-haven demand:
- Brent -2.19% to $67.29
- WTI -2.28% to $63.32
- Gold +0.82% to $3,393.57
Fed Under Fire
Markets were caught off guard by Trump’s latest move, with fraud accusations leading to Cook’s dismissal. While the initial reaction across equities was muted, investors are increasingly uneasy that the President may be seeking tighter control over the Fed.
Traders are now weighing the risks of escalating interference. Any further pressure from the White House could significantly damage confidence, with the US dollar and equities likely the most vulnerable to sharp corrections.
Geopolitics to Dominate on Quiet Calendar
With little on the macro calendar, attention is shifting toward geopolitical developments. Key highlights ahead:
- Asia-Pacific session: Australia’s latest inflation print. Consensus sees a 2.3% YoY rise (vs prior 1.9%). Any reading outside a ±0.2% margin could spark notable moves in the AUD.
- London session: Expected to remain subdued.
- New York session: Weekly US crude oil inventories (forecast -1.7m barrels) and comments from Fed’s Barkin.
Still, markets are bracing for geopolitical headlines to be the bigger driver of volatility through the day.