Key Takeaways
- US equity markets opened lower on Monday, January 12, 2026, with the Dow Jones down 0.62%, the S&P 500 falling 0.43%, and the Nasdaq dropping 0.39%, as investor sentiment was weighed down by concerns over Federal Reserve independence.
- Fears regarding the prosecution of Fed Chair Powell by the Justice Department, which Powell claims is a pretext to influence monetary policy, led to a rise in long-term Treasury yields and a weaker dollar, with analysts suggesting a potential boost to hawkish monetary policy.
- Walmart (WMT) shares rose approximately 2% after the announcement that it will replace AstraZeneca (AZN) on the NASDAQ-100 index effective January 20. Conversely, UnitedHealth (UNH) declined 1.9% following a Senate report detailing the company's aggressive tactics to boost Medicare payments.
- Q4 2025 S&P 500 earnings growth is projected at 8.3%, primarily driven by a robust 25.9% increase in the Technology sector.
- The Greenland government reaffirmed its commitment to the Western Defense Alliance, emphasizing that its defense will be under the auspices of NATO, a common interest for all member states including the United States.
US equity markets began the week on a downbeat note, with all major indices registering declines at market open. The Dow Jones Industrial Average dropped 308.29 points, or 0.62%, to 49,195.78, the S&P 500 fell 30.10 points, or 0.43%, to 6,936.18, and the Nasdaq was down 91.05 points, or 0.39%, at 23,580.30. This broad market weakness was largely attributed to escalating concerns over the independence of the Federal Reserve.
The sentiment was heavily impacted by the revelation that federal prosecutors have opened a criminal investigation into Fed Chair Jerome Powell. Powell, in a statement, accused administration officials of using the threat of prosecution, centered on a renovation project at the Fed's headquarters, to pressure the central bank into lowering interest rates. This unprecedented development has raised significant concerns about political interference in monetary policy, leading to a rise in long-term Treasury yields and a weakening of the dollar. Analysts suggest these worries could push the Fed towards a more hawkish stance to assert its independence.
In corporate news, Walmart (WMT) saw its shares climb approximately 2% after the announcement that it is set to join the NASDAQ-100 index on January 20, replacing AstraZeneca (AZN). This move follows Walmart's decision last year to shift its stock listing from the New York Stock Exchange (NYSE) to Nasdaq, reflecting its growing digital and technology-focused operations. Meanwhile, UnitedHealth (UNH) experienced a 1.9% decline in its stock price. This downturn came after a Senate report found that the company used aggressive tactics to boost Medicare payments, a practice the report concluded "turned risk adjustment into a business."
Looking ahead, the Q4 2025 earnings season is underway, with S&P 500 EPS growth projected at 8.3%. The Technology sector is expected to be a standout performer, leading growth with a projected 25.9% increase.
On the geopolitical front, the Greenland government issued statements reaffirming its strategic alignment. The coalition government believes that Greenland will forever be part of the Western Defense Alliance. They further stated that all NATO member states, including the United States, share a common interest in the defense of Greenland. The government also indicated it would increase efforts to ensure that Greenland's defense takes place under the auspices of NATO.
In France, an official from the French Finance Ministry stated that they have received no request and had no contact with Eli Lilly (LLY). The official also clarified that any investment involving a strategic pharmaceutical company would be subject to mandatory screening by the French Finance Ministry.
Ed Liston is a senior contributing editor at TheStockMarketWatch.com. An active market watcher and investor, Ed guides an independent team of experienced analysts and writes for multiple stock trader publications.