US Stocks Edge Higher Amid Trump’s Fed Feud and Trade Threats

Wall Street showed cautious Optimism as major indices posted modest gains despite political turbulence. The Dow Jones Industrial Average held steady while the S&P 500 and Nasdaq Composite each rose 0.2%, recovering slightly from Monday's pullback after last week's record rally.

Market sentiment remains fragile following President Trump's escalated confrontation with Federal Reserve Governor Lisa Cook. The administration's attempt to remove Cook over alleged mortgage fraud claims has raised concerns about central bank independence, particularly as TRUMP pushes for inflationary rate cuts. Cook has vowed legal action, calling the dismissal attempt "illegal."

Bond markets reflected the uncertainty, with 10-year Treasury yields dipping to 4.26% while 30-year yields climbed to 4.9%. The dollar index weakened as investors weighed the implications of political interference in monetary policy.

Trade tensions resurfaced with Trump's renewed threat of digital tax-related tariffs and semiconductor export restrictions. This dual pressure on both monetary and trade fronts creates a complex risk environment for markets navigating late-cycle economic conditions.