US STOCKS-Wall St set to fall at open on worries over Fed autonomy; financial stocks slide

By Medha Singh and Pranav Kashyap

Jan 12 (Reuters) - U.S. stock indexes were set to open lower on Monday after the Trump administration renewed its attacks on the Federal Reserve, stoking fresh worries about the central bank's independence, while a proposed one-year cap on credit-card interest rates weighed on financial stocks.

The administration threatened to indict Fed Chair Jerome Powell over his Congressional testimony on a renovation project, a move Powell called a "pretext" to gain more influence over interest rates that President Donald Trump has pressed to cut sharply since taking office in January 2025.

"For the Fed to put out a press release like this really shows the level of conflict that they have with the administration," said Giuseppe Sette, co-founder and president of investment analysis platform Reflexivity.

"Bottom line, the bull market still has legs and it's entirely possible that we see further gains irrespective of what happens with internal and external policy."

After the S&P 500 and the Dow closed the first week of 2026 at record highs, investors turned cautious over stretched valuations as big banks kick off the fourth‑quarter earnings season this week, led by JPMorgan Chase JPM.N on Tuesday.

At 8:29 a.m. ET, S&P 500 E-minis were down 0.51% to 6,969.5 points and Dow E-minis YMcv1 were down 301 points, or 0.61%. Nasdaq 100 E-minis NQcv1 were down 182.5 points, or 0.7%.

CREDIT-CARD RATE CAP

Shares of lenders and credit card firms slid after Trump called for a one-year cap on credit card interest rates at 10% starting on January 20.

Citigroup C.N tumbled 3.6%, JPMorgan Chase JPM.N fell 2.3% and Bank of America BAC.N dropped 2% in premarket trading.

Credit-card lender American Express AXP.N shed 3.4%, while consumer finance firms such as Synchrony Financial SYF.N, Bread Financial BFH.N and Capital One COF.N slumped between 8% and 11%.

J.P. Morgan, Barclays and Goldman Sachs joined Morgan Stanley in postponing their U.S. rate hike calls after data on Friday suggested the labor market was not rapidly deteriorating.

Traders are pricing in at least two more quarter-point rate cuts before the end of the year, LSEG data showed.

Attention now turns to Tuesday's U.S. consumer price inflation report, seen as key to gauging the Fed's next steps.

Goldman Sachs' Jan Hatzius said the indictment threat against Powell has heightened concerns over the Fed's independence, though he expects the policy decisions to remain data‑driven.

U.S.-listed shares of gold miners rose after bullion prices hit a record high for the first time this year. GOL/

Harmony Gold HMY.N rose 7.3%, while Barrick Mining B.N and Kinross Gold KGC.N gained nearly 4% each.

Among other corporate news, Walmart WMT.O rose 3.3% as the retailer, which shifted its listing to the Nasdaq from the NYSE last month, was set to join the Nasdaq-100 index .NDX on January 20.

UnitedHealth Group UNH.N fell 1.5% after the Wall Street Journal, citing a U.S. Senate committee investigation, reported that the insurer used aggressive tactics to collect diagnoses that can increase Medicare Advantage payouts.

Trump said he might block Exxon Mobil XOM.N from investing in Venezuela following CEO Darren Woods' comments that the South American country is "uninvestable." The U.S. energy major's shares dropped 0.9%.