US Treas Sec Bessent: Federal investigation made a mess, and could be bad for markets

Treasury Secretary Scott Bessent warned that the federal investigation into Fed Chair Jerome Powell could create a 'mess' in financial markets. His concerns are tied to expectations of leadership transition, which have been complicated by the ongoing investigation. Initially, markets reacted cautiously, with stocks dipping due to fears that political pressure could undermine the Fed's credibility and complicate monetary policy. However, by mid-session, the NASDAQ rebounded sharply, nearly hitting record highs, while the S&P 500 also erased early losses. This indicates that while political risk remains, investors are ready to buy on dips as long as liquidity and growth trends are upheld. The overall market sentiment may hinge on the evolving dynamics between the White House and the Fed.