Stocks Fall Pre-Bell as Fed Chair Powell Faces Department of Justice Probe

07:47 AM EST, 01/12/2026 (MT Newswires) -- The benchmark US stock measures were tracking in the red before the opening bell Monday amid Federal Reserve Chair Jerome Powell's announcement that the Department of Justice served the central bank with grand jury subpoenas.

The S&P 500 declined 0.7%, the Dow Jones Industrial Average fell 0.8% and the Nasdaq was off 0.9% in premarket activity. The indexes finished Friday's trading session in the green, with the Dow and the S&P reaching new all-time highs.

In an official statement on Sunday, Powell said federal prosecutors served the Fed with grand jury subpoenas threatening a criminal indictment linked to his earlier testimony regarding the multi-year renovation of the central bank's office buildings. Powell suggested that the probe reflects continued efforts by the Trump administration to influence monetary policy.

"The threat of criminal charges is a consequence of the Federal Reserve setting interest rates based on our best assessment of what will serve the public, rather than following the preferences of the President (Donald Trump)," according to Powell.

Trump denied any involvement in the investigation during a Sunday night interview with NBC News. "I don't know anything about it, but he's certainly not very good at the Fed, and he's not very good at building buildings," according to Trump.

Treasury yields were mixed in premarket action, with the two-year rate retreating 0.4 basis points to 3.54% while the 10-year rate gained 2.6 basis points to nearly 4.2%.

Shares of Wall Street banking giants and credit card companies, including JPMorgan Chase (JPM) , Bank of America (BAC) , Citigroup (C) , Visa (V) and Mastercard (MA), were down pre-bell after Trump called for a one-year cap on credit card interest rates at 10%, effective Jan. 20.

"We will no longer let the American public be 'ripped off' by credit card companies that are charging interest rates of 20% to 30%," Trump said in a social media post on Friday.

JPMorgan (JPM), Bank of America (BAC) and Citigroup (C) are expected to release their latest quarterly results later this week, along with other major lenders such as Wells Fargo (WFC) , Morgan Stanley (MS) , Goldman Sachs (GS) and Bank of New York Mellon (BK) .

With no major economic reports scheduled for Monday, investors will be looking ahead to key inflation data later in the week, including the consumer price index for December and the delayed producer price index for November. The retail sales reports for the previous two months are also out this week.

On Friday, government data showed that the US economy added fewer jobs than projected in December, while the unemployment rate moved down, likely supporting the case for a pause on interest rate cuts.

The probability of the Federal Open Market Committee keeping its benchmark interest rate unchanged later this month stood at 95% on Monday, according to the CME FedWatch tool.

Atlanta Fed President Raphael Bostic is slated to speak at 12:30 pm, while Richmond Fed President Thomas Barkin speaks at 12:45 pm. New York Fed President John Williams' remarks are due at 6 pm.

West Texas Intermediate crude oil decreased almost 1% to $58.54 a barrel before the open. Gold increased 2.2% to $4,599 per troy ounce, while bitcoin was up slightly at $90,494.

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