Stock Market Update

Equity futures point to a lower opening this morning after stocks had a strong first full week of 2026, with the major averages all gaining at least 1.5% on broad strength while small-caps outperformed. This week could prove to be consequential as well, as the market anticipates earnings reports from major banking names along with the latest CPI and PPI readings. 

The independence of the Fed is squarely in the headlines this morning after Fed Chair Jerome Powell said that the Department of Justice served the Federal Reserve with grand jury subpoenas, threatening a criminal indictment related to his testimony before the Senate Banking Committee last June that was related to renovations of the Fed's office buildings. 

NBC News reports that President Trump, in an interview, denied any involvement in the investigation, while Bloomberg reports that FHFA Director Bill Pulte was the key person behind the decision to issue the subpoena. 

Elsewhere, geopolitical tensions continue to escalate, with The New York Times reporting that President Trump is seriously considering authorizing a strike on Iran as anti-government protests continue to escalate. 

Developments in Venezuela continue to generate headlines as well, with Bloomberg reporting that oil companies are cautious about returning operations to the country after Exxon Mobil (XOM 123.60, -1.01, -0.8%) CEO called the country "uninvestable." In response, President Trump said he might block the company from investing in Venezuela, according to Reuters. 

In corporate news:

• President Trump called for a one-year cap on credit card interest rates of 10%, sending credit card stocks lower.
• NVIDIA (NVDA 183.08, -1.74, -0.9%) and Tesla (TSLA 442.65, -2.36, -0.5%) are pursuing the same self-driving goal, according to Bloomberg. 
• Paramount (PSKY 12.12, +0.06, +0.5%) initiated "Plan D" to top Netflix's (NFLX 89.22, -0.22, -0.2%) bid for Warner Brothers (WBD 28.63, -0.26, -0.9%), according to The New York Post. 

Reviewing overnight developments:

Equity indices in the Asia-Pacific region enjoyed a higher start to the week while Japan's Nikkei was closed for a holiday. Japan's Nikkei: HOLIDAY, Hong Kong's Hang Seng: +1.4%, China's Shanghai Composite: +1.1%, India's Sensex: +0.4%, South Korea's Kospi: +0.8%, Australia's ASX All Ordinaries: +0.5%.

In news:

• Press reports from Japan suggest that Prime Minister Takaichi could call a snap election for February in order to boost her coalition's numbers in parliament.
• South Korea's exports through the first ten days of January were down 2.3% yr/yr but chip exports still jumped 45.6% yr/yr while auto and ship exports fell.
• Australia is planning to establish a critical minerals strategic reserve by the end of the year.

In economic data:

• India's December CPI 1.33% yr/yr (expected 1.50%; last 0.71%)
• Australia's December ANZ Job Advertisements -0.5% m/m (last -1.5%)

Major European indices trade near their flat lines, while Germany's DAX (+0.6%) outperforms, extending to a fresh record high, with health care and industrials contributing to the relative strength. STOXX Europe 600: -0.1%, Germany's DAX: +0.6%, U.K.'s FTSE 100: +0.1%, France's CAC 40: UNCH, Italy's FTSE MIB: +0.1%, Spain's IBEX 35: UNCH.

In news:

• There are some concerns that France will go into the spring without a full budget agreement for the year if the tentative coalition government collapses.

In economic data:

• Eurozone's January Sentix Investor Confidence -1.8 (expected -5.1; last -6.2)
• Swiss December SECO Consumer Climate -31 (expected -33; last -34)