MILAN, January 12, 2026 — Despite a criminal investigation launched against Federal Reserve Chair Jerome Powell, European stock markets largely shrugged off the political turmoil, closing mostly in positive territory. The unexpected resilience suggests investors are cautiously optimistic, but a flight to safe-haven assets like gold and silver indicates underlying anxieties about escalating tensions between the White House and the central bank.
A clash between Washington and the Fed is rattling markets, but initial reactions suggest a measured response.
- European stock exchanges stemmed panic, closing mostly positive.
- Gold and silver reached new record highs amid geopolitical and economic uncertainty.
- A criminal investigation into Federal Reserve Chair Jerome Powell was revealed.
- Alphabet reached a $4 trillion market valuation, fueled by AI advancements.
The conflict between President Donald Trump and the Federal Reserve reached a new level with the Justice Department’s investigation into Powell, related to his testimony before the Senate Banking Committee regarding proposed renovations to Fed buildings. Powell himself characterized the investigation as part of “threats and political pressures” intended to influence the central bank’s decisions. Ironically, some analysts believe Trump’s attacks could deter further interest rate cuts.
Wall Street Wobbles, Alphabet Soars to $4 Trillion
Table of Contents
Wall Street experienced weakness following the news of the investigation. Trump’s proposal to cap credit card interest rates at 10% for one year also contributed to market instability, with concerns that the measure could backfire, restricting lending and harming both consumers and bank profitability. However, the week also marks the beginning of the quarterly earnings season for major U.S. banks, including Goldman Sachs, JPMorgan Chase, Bank of America, and Morgan Stanley.
Meanwhile, Alphabet, Google’s parent company, achieved a market capitalization of $4 trillion, bolstered by growing confidence in its artificial intelligence strategy.
Fincantieri Leads Gains in Milan, Stellantis Lags
In Milan, Fincantieri stood out after its Norwegian subsidiary, Vard, secured a 200 million euro contract with American Ocean Infinity for four robotic ships. Leonardo – Finmeccanica and Buzzi Unicem also performed well. Bpm Bank rose on rumors of a potential green light from the European Central Bank in January to increase Credit Agricole’s stake (up to 29.9%). Mps Banking was among the riskier performers.
At the close of trading, Lottomatica Group lagged, impacted by a decline in the online betting market, and Stellantis announced plans to phase out plug-in hybrid vehicles in North America, focusing on traditional hybrids. Gains were seen in Diasorin, Saipem, and Intesa Sanpaolo, while Italgas, Brunello Cucinelli, and Terna declined.
Gold Breaks $4,600 Barrier, Silver Surges
Gold reached a new record high, surpassing $4,600 per ounce for the first time. Geopolitical and macroeconomic uncertainties, coupled with the renewed attack by President Trump on the Federal Reserve, are driving investment in the precious metal. Gold futures peaked at $4,600.33 before settling at $4,588.80. The spot price reached $4,469.49 before falling back to $4,582.31. Silver also continued its rally, reaching a high of $84.60.
“The trend in precious metals is a reminder of how many uncertainties are plaguing the markets: geopolitics, the growth/rate debate and now an institutional risk premium,” according to analysts at Saxo Markets.
Oil Prices Climb Amid Iran Crisis
Tensions in Iran, where over 500 people have been killed during two weeks of protests and the Iranian parliament has threatened attacks on U.S. military bases in the Middle East, have pushed up oil prices. North Sea Brent is rising above $64 a barrel (+0.4%) and WTI is approaching $60 a barrel (+0.3%). ANZ analysts estimate the situation in Iran puts at least 1.9 million barrels per day of oil exports at risk.
