Nasdaq 100: Bearish Signal as Trump Targets Fed, Tech Sector Crumbles

Investor Nerves Fray as Futures Signal Broad Weakness

U.S. stock futures declined sharply early Monday, as traders brace for a turbulent week marked by deepening political interference concerns and intensifying global trade tensions. Dow futures dropped 381 points (-0.97%) to 38,948.00, while S&P 500 and Nasdaq futures fell 1.14% and 1.27%, respectively. The moves follow another down week on Wall Street, amplifying anxiety ahead of a critical earnings cycle and potential monetary policy disruptions.

Trump’s Challenge to Fed Independence Fuels Market Jitters

A brewing confrontation between President Trump and Federal Reserve Chair Jerome Powell has become a top concern. Reports that Trump’s legal team is exploring options to remove Powell have raised alarms over central bank independence—a core pillar of global investor confidence in U.S. policy stability. While Chicago Fed President Austan Goolsbee tried to reassure markets over the weekend, the growing perception of political overreach has heightened risk-off sentiment.

Currency and Bond Markets Signal Erosion in Confidence

The dollar fell sharply on Monday, underscoring growing unease. The euro touched a three-year high, while the yen hit a seven-month peak and the Swiss franc surged to levels last seen over a decade ago. Bond markets showed a split view—10-year Treasury yields rose 3.5 basis points, but the two-year fell 3.6 bps, reflecting a tug-of-war between inflation expectations and rate cut speculation. Gold soared to a new record of $3,370.17 per ounce, while bitcoin climbed past $87,500, marking investor flight into alternative assets.

Tech Stocks Face Dual Pressure from Earnings and Export Restrictions

Investors are also preparing for a critical stretch in earnings season. Alphabet, Intel, and Tesla report this week, but sentiment is fragile following steep YTD losses across megacap tech. The sector faces additional strain after U.S. regulators tightened export controls on Nvidia and AMD chips bound for China. Nvidia halted shipments of its H20 GPUs, leading to a projected $5.5 billion quarterly hit. Meanwhile, Chinese AI chipmakers like Cambricon have surged, capitalizing on the vacuum.

Tariffs Add to Global Trade and Economic Stress

Fresh signs of strain are emerging in trade. South Korea’s April export drop points to a broader economic hit from U.S. tariffs, even as negotiations between the U.S. and several countries continue. Oil markets offered rare relief, falling over 1.7% as U.S.-Iran nuclear talks progressed, easing concerns over Middle East supply risks.

Pre-Market Outlook: Bearish Short-Term Bias Prevails

With rising political interference risks, earnings uncertainty, and deepening global trade issues, the short-term outlook remains bearish. Investors are reducing exposure to U.S. risk assets, rotating into defensive plays and alternative stores of value. Until clarity emerges on Fed independence and tariff policy, markets are likely to remain under pressure.

More Information in our Economic Calendar.