The U.S. stock market entered the week with strong momentum. The S&P 500 and Nasdaq both closed at record highs, supported by gains in big technology names such as Alphabet and Tesla. Optimism grew after President Donald Trump praised the progress of U.S.-China trade talks, helping ease investor fears. Analysts also highlighted a rare improvement in earnings expectations across sectors, which boosted confidence further. However, futures trading later signaled caution, with the S&P 500 and Dow Jones barely moving ahead of the Federal Reserve’s rate decision.
FED Confirmation Sparks Debate
A key political development has fueled debate about central bank independence. The Senate narrowly confirmed Stephen Miran, Trump’s pick for the Federal Reserve Board of Governors, just before the crucial policy meeting. Miran will also keep his White House role, taking only unpaid leave, which critics say undermines the FED’s independence. Democrats, along with some economists, argue that a dual role raises the risk of political influence over monetary policy. While Miran’s short term may limit his direct impact, his presence has already intensified pressure on FED Chair Jerome Powell, who faces strong demands from Trump for deeper rate cuts.
Gold Breaks Records as Investors Hedge
Gold markets are signaling anxiety despite record highs in the stock market. Bullion hit another all-time high above $3,685 an ounce, supported by expectations of a FED rate cut and a weaker U.S. dollar. Investors see gold as a safe haven, especially as Trump’s public campaign against the FED unsettles markets. Demand has also been fueled by central bank purchases and heavy inflows into gold-backed exchange-traded funds. Analysts note that if even a small share of private U.S. Treasury holdings moves into gold, prices could climb toward $5,000 an ounce. The surge underscores how investors are hedging against both monetary easing and political turbulence.
Stock Market Eyes Europe and Global Trade
Across Europe, the stock market outlook remains subdued. Traders are weighing the outcome of U.S.-China talks while also monitoring domestic data such as U.K. unemployment and German sentiment. Major European indexes opened little changed, with Germany’s DAX and the U.K.’s FTSE barely higher and France’s CAC 40 slipping. The uncertainty reflects how Europe’s fortunes remain tied to global trade negotiations, which are far from resolved. Meanwhile, the planned visit of President Trump to the U.K. adds another layer of political focus, as leaders prepare to discuss both trade and geopolitical strategy.
Stock Market Braces for FED’s Next Move
The real test for markets comes with the FED’s policy decision. Futures markets are fully pricing in a quarter-point cut, but traders are split on whether deeper easing may follow. Powell has resisted Trump’s pressure in the past but has left the door open to more cuts due to weak labor data and trade-related uncertainty. Any signal of a more aggressive path could shake both the stock market and gold prices. Investors are therefore closely watching not just the rate cut itself, but Powell’s press conference and the FED’s updated economic projections. The message will set the tone for both U.S. and European markets in the weeks ahead.