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World Shares Mixed, US Futures Slip 01/12 05:02
U.S. futures sank Monday after Federal Reserve Chair Jerome Powell said the
Department of Justice had served the central bank with subpoenas.
BANGKOK (AP) -- U.S. futures sank Monday after Federal Reserve Chair Jerome
Powell said the Department of Justice had served the central bank with
subpoenas.
Markets in Europe were mostly lower after a broad rally in Asia.
The threat of a criminal indictment over Powell's testimony about the Fed's
building renovations is the latest escalation in President Donald Trump's feud
with the Fed. Trump has criticized the $2.5 billion renovation of two office
buildings as excessive.
Markets appeared to take the news in stride, although gold and other
precious metals often used as a hedge in times of uncertainty climbed.
The future for the S&P 500 declined 0.7% and that for the Dow Jones
Industrial Average fell 0.6%. The future for the Nasdaq composite index slipped
1.1%.
In Germany, the DAX was nearly flat at 25,265.46, while the CAC 40 in Paris
shed 0.5% to 8,319.03. Britain's FTSE 100 edged 0.1% lower, to 10,114.82.
In Asian trading, Hong Kong's Hang Seng gained 1.4% to 26,608.48, while the
Shanghai Composite index jumped 1.1% to 4,165.29 after reports that Chinese
leaders were preparing more help for the economy.
Tokyo's markets were closed for a holiday.
In South Korea, the Kospi added 0.8% to 4,624.79, while Australia's S&P/ASX
200 gained 0.5% to 8,759.40.
Taiwan's Taiex gained 0.9%.
On Friday, U.S. stocks hit records following a mixed report on the U.S. job
market, one that may delay another cut to interest rates by the Federal Reserve
but does not slam the door on it.
Powell's term as chair ends in May, and Trump administration officials have
signaled that he could name a potential replacement this month. Trump has also
sought to fire Fed governor Lisa Cook.
In a brief interview with NBC News Sunday, Trump insisted he didn't know
about the investigation into Powell. When asked if the investigation is
intended to pressure Powell on rates, Trump said, "No. I wouldn't even think of
doing it that way."
The S&P 500 climbed 0.6% to 6,966.28, topping its prior all-time high set
earlier in the week. The Dow Jones Industrial Average added 0.5% to 49,504.07,
and likewise set a record.
The Nasdaq composite led the market with a 0.8% gain, closing at 23,671.35.
The U.S. Labor Department said employers hired fewer workers during December
than economists expected, though the unemployment rate improved and was better
than expected. It reinforced how the U.S. job market may be in a " low-hire,
low-fire" state and may hopefully avoid a recession.
An update on U.S. inflation at the consumer level is due Tuesday, followed
by a report on wholesale prices on Wednesday.
In other dealings early Monday, the dollar fell to 157.77 Japanese yen from
158.03 yen.
The euro climbed to $1.1690 from $1.1635 late Friday.
U.S. benchmark crude oil gave up early gains, falling 12 cents to $59.00 per
barrel. Brent crude, the international standard, shed 9 cents to $63.25 per
barrel.
The price of gold rose 2.3% and the price of silver jumped 6.3%. Copper was
up 1.4%.
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