Powell's Plot Twist: When the Fed Chair Gets the Subpoena Treatment

Major U.S. News Headlines

• DOJ Launches Criminal Investigation Into Fed Chair Jerome Powell — BEARISH ⚠️ Federal prosecutors have opened a criminal investigation into Federal Reserve Chair Jerome Powell related to his testimony about the Fed building renovation[1]. Powell stated in a video message that the investigation is ultimately part of President Trump's administration's push to pressure the Federal Reserve to lower interest rates[1]. This represents an extraordinary escalation in attacks on the Fed's independence and creates significant uncertainty around monetary policy direction, potentially unsettling markets concerned about political interference in monetary decisions.

• Nationwide Anti-ICE Protests Following Renee Good's Death — NEUTRAL Widespread protests have erupted across U.S. cities following the death of Renee Good, a 37-year-old woman shot by an ICE officer in Minneapolis[1]. At least 1,000 protest events were planned for the weekend, organized under the "ICE Out For Good Weekend of Action" by progressive coalition Indivisible[1]. While this reflects ongoing social and political tensions, the direct market impact is limited unless it leads to broader policy changes or civil unrest affecting economic activity.

Key International News

• Trump Considers Intervention in Iran Amid Violent Protests — BEARISH ⚠️ President Trump is preparing for potential intervention in Iran as the country experiences violent anti-government protests with hundreds reportedly killed and internet access cut off[1]. Possible measures under consideration include cyber weapons deployment, additional sanctions, and military strikes, with Trump's aides set to brief him on Tuesday[1]. This geopolitical escalation creates risk of regional conflict, which could disrupt oil markets and increase global volatility.

• Trump Pressures Cuba on Venezuelan Oil Imports — NEUTRAL President Trump has issued demands to Cuba regarding Venezuelan oil imports, signaling continued pressure on foreign policy matters related to energy supply chains[2]. The broader implications for energy markets remain unclear pending further developments.

Global Stock Market Trends

The search results provided do not contain specific information regarding U.S. futures, European market indices, or Asian market performance as of January 12, 2026. Real-time market data is needed to complete this section.

Commodity and Currency Movements

The search results provided do not contain specific data on oil prices, gold movements, USD performance, or Treasury yield movements as of January 12, 2026. Real-time commodity and currency data is needed to complete this section.

Analysis of News Impact on the Stock Market

The dominant market driver is the DOJ investigation into Fed Chair Powell, which represents unprecedented political pressure on monetary policy independence. This creates a bearish headwind for equities due to:

• Policy uncertainty: Ambiguity about future rate decisions undermines forward guidance that markets depend on for valuation models
• Institutional erosion: Attacks on Fed independence threaten the credibility of the central bank and could increase inflation expectations
• Risk premium expansion: Political risk around monetary policy typically widens credit spreads and increases equity risk premiums

The Iran geopolitical escalation adds secondary bearish pressure through potential energy market disruption and increased safe-haven demand, though its impact depends on whether military action materializes.

The ICE protest movement is primarily a social and political concern without immediate direct market implications unless economic activity is substantially disrupted.