Can markets bounce back when economic uncertainty meets political drama? Financial markets went from euphoria to whiplash as President Trump fired Fed Governor Lisa Cook—an unprecedented move that immediately rattled investors. The US dollar slid, Treasuries sank, and S&P 500 futures gave up some of last week’s gains. The move raised questions about the Federal Reserve’s independence, and investors braced for more politicized monetary policy just as hopes for a September rate cut hit over 80% odds (CNN, Yahoo Finance).
US stocks, after hitting all-time highs on Friday, slid Monday—Dow -0.8%, S&P 500 -0.4%—as markets nervously eyed both the Fed and looming Nvidia results as a litmus test for the AI rally. Gold spiked 1% as investors hunted for safety, and bond yields steepened with political risks swirling.
