MARKET WRAPS
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No major economic or trading updates expected
Opening Call:
European stock futures were lower after Asia stocks broadly rose. The dollar weakened, U.S. Treasurys were flat. Gold rose and oil edged higher.
Equities:
European stock futures fell, as U.S. futures declined after Fed Chair Jerome Powell said the Department of Justice had subpoenaed the Federal Reserve on Friday and threatened a criminal indictment against him over cost overruns at the agency's headquarters.
In a statement late Sunday, Powell said the accusations that he misled Congress over the cost of the renovations were a pretext for President Donald Trump to pressure the Fed to cut interest rates, and that the investigation threatens the Fed's independence.
Earnings season is also set to start this week, with quarterly reports expected from big U.S. banks such as Goldman Sachs, JPMorgan Chase, Bank of America and Morgan Stanley.
Forex:
The U.S. Justice Department's grand jury subpoenas delivered to the Fed shift the narrative from "process and paperwork," to independence and credibility, Saxo Markets' Charu Chanana said.
Markets have also priced in an institutional risk premium even before any actual policy changes, says the chief investment strategist. An "institutional risk" narrative is likely to pressure USD and could push flows toward CHF and JPY, she added.
Bonds:
Resilience in U.S. labor markets underscores bets on a pause in interest rate cuts by the Fed, boosting Treasury yields, mostly on the shorter end of the curve, amid mixed weekly performance.
An expected Supreme Court ruling on tariffs isn't issued, keeping markets in suspense, while Hassett says the administration has a plan to keep the levies in place in case of an upset.
Looking ahead, U.S. December CPI is expected Tuesday, as the government catches up on data releases delayed by October's shutdown.
Energy:
Tensions in Iran are fueling concerns in the oil market, said ANZ Research analysts in a note.
Over 500 people have been killed in two weeks of unrest in Iran, a rights group said on Sunday, while Iran's parliamentary speaker threatened to attack American military bases in the Middle East if the U.S. acts first.
The situation in Iran puts at least 1.9 million barrels per day of oil exports at risk of disruption, ANZ analysts said.
Metals:
Gold rose in the early trading, as U.S. President Trump is scheduled to be briefed Tuesday on specific options to respond to protests in Iran, the WSJ reported, citing U.S. officials.
Meanwhile, the U.S. has continued to seize so-called shadow tankers carrying sanctioned oil to and from Venezuela.
Rising geopolitical risks linked to Iran and Venezuela have revived safe-haven demand for gold, said Saxo Bank's Ole Hansen in an email.
"Gold, silver and platinum have all started the year strongly, reflecting a mix of geopolitical hedging, financial flows and structural investment themes," the head of Commodity Strategy added.
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Copper was higher in early trading amid concerns about tightening supply.
Investors are concerned that the U.S. will impose an import levy, said ANZ analysts. This continues to draw shipments into the U.S. and tighten stocks elsewhere, they noted.
Investors are also closely watching U.S. rate-cut decisions as December data in U.S. shows employers added fewer jobs than expected, they said.
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Prices of iron ore and metallurgical coal could move higher in the short term on seasonal influences, but will likely soften by mid-year, according to Jefferies.
That is because Chinese steel markets are expected to stay relatively weak while "supply growth (especially in met coal) is coming," they said.
The analysts expect the mining sector to perform well on the whole this year, while noting shares of diversified giants Rio Tinto and BHP--which generate much of their profits from iron ore--will lag pure-play copper miners and other base metals producers.
TODAY'S TOP HEADLINES
U.S. Prosecutors Are Investigating Fed Chair Jerome Powell
U.S. prosecutors are investigating Federal Reserve Chair Jerome Powell over his testimony last summer about the central bank's building renovation project, according to government officials with knowledge of the matter.
The Fed received grand jury subpoenas from the Justice Department on Friday that threaten a criminal indictment relating to Powell's testimony, the Fed chair said in a video statement on Sunday night.
Weakened by War, Iran's Regime Faces Its Toughest Challenge Yet
DUBAI-Iran's 12-day war with Israel and the U.S. last June broke the regime's carefully nurtured image of invincibility, many ordinary Iranians say. Now the aftermath is helping to fuel a wave of protests over the past two weeks that has left at least 500 people dead as the Islamic Republic attempts to regain control.
Footage seeping out of the country shows mass protests are continuing despite the crackdown. Human-rights-group assessments say security forces have already gunned down hundreds, and possibly thousands, of protesters. President Trump has repeatedly threatened to attack Iran if deadly force is used, and on Tuesday aides are scheduled to brief him on specific measures the U.S. can take to respond to the killings.
Russian Flags Proliferate Over Shadow Fleet of Oil Tankers
With five oil tankers seized-and more U.S. military action promised-the world's fleet of so-called shadow tankers that ferry sanctioned crude are quickly hoisting a new flag: the Russian tricolor.
Their hope is that by operating under the flag of a country with a strong navy they might be able to skirt the U.S. blockade on Venezuelan oil movements and avoid interception by the Coast Guard.
Trump 'Inclined' to Keep Exxon Out of Venezuela
WASHINGTON-President Trump said he might block Exxon Mobil from drilling in Venezuela after the company's top executive publicly acknowledged the barriers involved in doing business in the country.
"I'll probably be inclined to keep Exxon out," Trump said Sunday evening, speaking to reporters traveling with him aboard Air Force One.
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Expected Major Events for Monday
00:01/UK: Dec KPMG and REC UK Report on Jobs
06:00/FIN: Nov Balance of Payments
07:00/ROM: Nov International trade
07:00/DEN: Dec CPI
07:30/HUN: Nov Preliminary Industrial Production
08:00/SVK: Nov Employment and average monthly wage in selected branches
08:00/SVK: Nov Turnover in selected branches of economy, incl Industry & Construction
08:00/SWI: Dec Consumer Sentiment Index
11:00/FRA: Nov OECD CPI
15:59/UKR: Dec CPI
16:59/GER: Nov Balance of Payments
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(END) Dow Jones Newswires
January 12, 2026 00:02 ET (05:02 GMT)
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