Stock Market Today: S&P 500, Dow End at Fresh Records as Tech Strength Eases Fed Concerns
U.S. stock markets finished Monday’s session at fresh record highs, with gains in technology stocks driving a broader rebound despite renewed concerns about the independence of the Federal Reserve. Investor unease followed the latest political pressure on Federal Reserve Chair Jerome Powell from the administration of President Donald Trump.
By the close of trading at 4:00 p.m. ET, the Dow Jones Industrial Average rose by 86 points, or 0.2%, to settle at a record level of 49,590.20. The S&P 500 also advanced 0.2%, ending the day at a new closing high of 6,976.71, while the NASDAQ Composite added 0.3%.
Powell Faces Rising Political Pressure as Yellen Issues Warning
In a statement released late Sunday, Jerome Powell confirmed that federal prosecutors have opened a criminal investigation related to his testimony before the Senate Banking Committee regarding renovations to Federal Reserve office buildings. However, Powell suggested that the threats surrounding the investigation were likely driven by repeated political calls to sharply reduce interest rates.
“This new threat is not about my testimony last June or about the renovation of Federal Reserve buildings,” Powell said. “It is about whether the Fed will be able to continue setting interest rates based on evidence and economic conditions, or whether monetary policy will instead be shaped by political pressure or intimidation.”
These remarks represent Powell’s most direct response so far to the growing political pressure on the central bank to cut rates aggressively. Over the past year, President Trump has pushed for interest rate reductions of at least two percentage points, while the Federal Reserve implemented total cuts of just 0.75% in 2025. Policymakers cited persistent inflation and uncertainty stemming from trade policies as reasons for caution.
Tensions between the White House and the Federal Reserve have intensified further as Powell’s term is set to expire in May. The president stated last week that he was close to selecting a successor.
Market analysts noted that Powell has clearly framed the situation as an attack on the Fed’s independence. They added that the initial market reaction reflected these concerns, pointing to simultaneous declines in the U.S. dollar, equities, and Treasury bonds, reminiscent of last spring’s broad “sell America” sentiment.
Former Federal Reserve Chair Janet Yellen also weighed in, warning that the investigation into Powell was “extremely chilling.” She argued that it appeared to signal a deliberate effort to remove the Fed chair, reinforcing fears that political leaders are seeking greater influence over monetary policy rather than allowing the central bank to operate independently.
December CPI Data in Focus
Investors are now looking ahead to a busy week of economic releases, highlighted by the publication of December consumer price index data on Tuesday. Headline inflation is expected to remain steady, while core CPI is forecast to show a modest increase.
The upcoming inflation report follows softer-than-expected data for November. Some analysts cautioned that those figures may have been distorted by disruptions linked to a prolonged government shutdown in late 2025.
Financial markets are largely pricing in no change to interest rates at the Federal Reserve’s January meeting, after policymakers signaled a higher threshold for additional rate cuts this year.
Beyond CPI data, the week’s calendar also includes producer price figures, retail sales numbers, and comments from several Federal Reserve officials.
Banks Set to Launch Fourth-Quarter Earnings Season
On the corporate front, the fourth-quarter earnings season is set to begin in earnest, led by reports from major U.S. banks. Several large financial institutions are scheduled to release results early in the week, followed by additional investment banks and asset managers later on.
These earnings reports are expected to shed light on how U.S. companies navigated economic disruptions caused by a government shutdown and ongoing geopolitical tensions during the final quarter of 2025.
Ahead of the earnings announcements, shares in the financial sector came under pressure after President Trump called for a one-year cap on credit card interest rates. The proposal reignited concerns about increased regulatory risks facing banks.
In a social media post over the weekend, Trump said he wanted to impose a 10% ceiling on credit card annual percentage rates starting January 20, arguing that consumers are being overcharged by rates typically ranging between 20% and 30%.
Gold Hits New Highs as Oil Prices Stabilize
In other markets, gold prices climbed to new record levels as investors sought safe-haven assets amid rising geopolitical tensions, increasing political pressure on the Federal Reserve, and weaker U.S. employment data.
The U.S. dollar also weakened, further supporting gold by making the metal more affordable for buyers using other currencies.
Meanwhile, oil prices have stabilized following recent gains. Ongoing civil unrest in Iran, a key energy producer in the Middle East, has raised concerns about potential disruptions to global oil supplies, helping keep prices supported.
