MARKET NEWS

LONDON, Jan 12 (Reuters) - Gold vaulted to a record high and both the dollar and Wall Street futures fell on Monday, as a criminal investigation into Federal Reserve Chair Jerome Powell stoked concerns about the independence of the world's most influential central bank.
Powell slammed the move as part of U.S. President Donald Trump's push for greater control over the Fed, while for traders it added to a frenetic start to 2026, which has already seen the U.S. capture Venezuela's Nicolas Maduro and set its sights on Greenland.

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S&P 500 and Nasdaq futures were both down more than 0.6% ahead of the U.S. market open, with the VIX 'fear gauge' (.VIX)

, opens new tab up the most since November and gold - which investors buy as a hedge against both turmoil and inflation - hitting $4,600 an ounce. Bond markets also priced in a slightly higher chance of short-term U.S. interest rate cuts. Europe's STOXX 600 share index (.STOXX)

, opens new tab stuck close to record highs as arms stocks set fresh peaks and as the Swiss franc - another classic safe-haven play - and the euro and sterling all strengthened in the FX market. /FRX "The latest development marks a significant escalation in the fight between President Trump and Fed Chair Powell," MUFG's Lee Hardman said, adding that "the repeated attacks on the Fed’s independence" continued to pose downside risks for the dollar. Advertisement · Scroll to continue Fed funds futures have added in about three basis points more in cuts this year, which is small but points to the risk that the Fed gets pushed into being more aggressive. Gold's more than 1.5% jump was complemented by a 5% leap in silver . also buoyed by rising geopolitical tensions around Iran. However, oil prices ticked lower as commodity traders showed little immediate panic, especially with the prospect of more Venezuelan crude coming into the market. Trump said on Sunday he was weighing a range of strong responses, including military options, to a violent crackdown on Iranian protests which pose one of the biggest challenges to the country's clerical rule since the 1979 Islamic Revolution. Iran's Foreign Minister Abbas Araqchi said on Monday via English translation that the situation was "under total control". Brent crude futures dipped around 50 cents to sit just below $63 a barrel, while U.S. West Texas Intermediate crude was at $58.60 a barrel, down 45 cents. O/L Both benchmarks rose more than 3% last week in their biggest such increase since October, as Iran's clerical establishment stepped up its crackdown on the demonstrations. While a premium has formed in oil prices in recent days, the market is still underestimating the risk given a wider conflict could affect the Strait of Hormuz, said Saul Kavonic, head of energy research at MST Marquee.