Gold surges as Powell-Trump clash rattles S&P 500

Gold surged past $4,600 an ounce as investors sought safety after Federal Reserve Chair Jerome Powell pushed back against political pressure from the Trump administration. The dollar weakened and US stock futures, including the S&P 500, turned lower following reports of threats to indict Powell. Market moves were contained, with investors watching whether Fed independence is compromised and how US rates are set this year. Geopolitical tensions, including unrest in Iran, added to the defensive tone.

Equities

The FTSE 100 closed at a record high on Friday, ending the session up 0.8% at 10,126.6 points, supported by strong moves in mining and energy stocks. The index also recorded its second consecutive weekly gain, while the FTSE 250 added 0.6% on the day, remaining close to its highest level in more than three years. London trading was underpinned by company-specific developments rather than broad macro themes, with several heavyweight stocks driving the advance.

Glencore shares surged 9.6% by the close after reports that the miner is in talks with Rio Tinto about a potential takeover that would create the world’s largest mining group. The news pushed Glencore to its highest share price since July 2024. Rio Tinto’s London-listed shares moved in the opposite direction, closing 3% lower as investors assessed the implications of a possible deal structure. Energy stocks also rose sharply, tracking firmer oil prices, with the sector gaining 2.8% by the end of trading. In contrast, Sainsbury’s shares fell 5.3% after the supermarket group reported weaker general merchandise and clothing sales over the Christmas quarter. IAG declined 2.7% after announcing the appointment of British Airways finance chief Jose Antonio Barrionuevo as its new group chief financial officer from June.

In the United States, the S&P 500 closed 0.65% higher on Friday at a record 6,966.28 points, rounding off a strong first full week of trading in 2026. The Nasdaq ended the session up 0.82%, while the Dow Jones Industrial Average added 0.48%. Gains were concentrated in technology and semiconductor stocks. Broadcom closed 3.8% higher, Alphabet added 1%, and Tesla rose 2.1%, collectively lifting the main indices. The Philadelphia Semiconductor Index jumped 2.7% to a record high.

Lam Research climbed 8.7% after Mizuho raised its price target on the chip equipment maker, while Intel surged almost 11% late on Friday after President Donald Trump said he had held a “great meeting” with chief executive Lip-Bu Tan. Elsewhere, Vistra jumped 10.5% after Meta Platforms agreed to buy power from the company’s nuclear plants, highlighting growing demand for energy linked to data centres and artificial intelligence.

Mortgage-related stocks also moved sharply higher after comments from Trump about buying mortgage bonds. LoanDepot surged 19.3%, Rocket Companies gained 9.6%, and Opendoor Technologies rose 13.1%. By contrast, General Motors closed more than 2% lower after announcing a $6bn charge related to unwinding parts of its electric vehicle investments.

Forex & Commodities

Stocks and currencies moved lower as tensions between the White House and the Federal Reserve escalated, keeping investors cautious at the start of the week. The US dollar weakened broadly in Asian trading, falling against both safe-haven and risk-sensitive currencies after Fed chair Jerome Powell said the Trump administration had threatened him with a criminal indictment. By early morning, the euro was higher at 1.166 and the Swiss franc had strengthened to 0.7979 per dollar. Sterling was also firmer against the dollar, trading above the mid-1.26 area, as the greenback remained under pressure.

US equity futures pointed lower, with S&P 500 futures down in early trade, while European stock futures edged lower. Asian shares were steadier, led by gains in technology stocks, after recent US labour market data suggested slowing but not sharply deteriorating employment conditions. Japanese markets were closed for a public holiday.

Gold prices surged early on Monday as investors sought safety amid the political and geopolitical backdrop. Spot gold rose to a record high above 4600 per ounce in morning trade, later holding near 4585 per ounce. Silver also climbed sharply to a fresh all-time high near 84.60 per ounce, while platinum and palladium extended recent gains. The move in precious metals came alongside reports of intensifying unrest in Iran and renewed threats of US involvement, adding to demand for defensive assets.

Oil prices edged lower after strong gains last week. Brent crude was trading around 63.25 a barrel in Asian hours, while US crude was near 59.02 a barrel. Prices eased after Iran said the situation was under control following weekend violence, though traders continued to watch the risk of wider disruption, including potential impacts on shipping through the Strait of Hormuz. Attention also remained on Venezuela, where preparations are under way to resume oil exports following political change.