Trump Fires Fed Governor Lisa Cook Amid Mortgage Controversy

GLOBAL MOOD: Risk-Off
Drivers: Oil Supply Risks, Russian-Ukraine Tensions, Fed Rate-Cut Speculation 

Markets leaned risk-off as oil and Treasury yields rose, the dollar rebounded, and equities digested Powell’s rate-cut hints. Investor optimism was tempered by geopolitical and political uncertainties, but focus remained on potential monetary easing and corporate earnings.

TODAY’S WATCHLIST
 - US July Core Durable Goods Orders Data
 - FOMC Member Williams Speaks  

THE BIG STORY
US President Donald Trump fired Lisa Cook, the first African American woman to serve as a Federal Reserve governor, following allegations that she claimed two of her mortgages as primary residences. The move came after Federal Housing Finance Agency Director William Pulte, appointed by Trump, raised concerns over Cook’s mortgage practices. The Department of Justice is reportedly investigating, though no public evidence has yet been provided.

Cook, nominated to the Fed’s Board by President Biden in 2022, took out the disputed mortgages in 2021 while working as an academic. Loans on primary residences typically carry lower borrowing rates, and the controversy has highlighted tensions in US financial governance. 

Meanwhile, Jefferies raised their year-end S&P 500 target to 6,600, citing robust corporate earnings and easing economic concerns.

Data Spotlight
Sales of new US single-family homes fell 0.6% in July to a seasonally adjusted annualised rate of 652,000 units, following an upward revision of June sales to 656,000 units from 627,000. The report highlights a housing market that continues to struggle under high mortgage rates, which remain above wage growth and make homeownership increasingly difficult for many buyers. 

Takeaway: The US housing market remains under pressure, as high mortgage rates and affordability constraints continue to limit new home sales, signalling ongoing headwinds for the sector.

WHAT HAPPENED OVERNIGHT

• US Stocks slips as investors weigh Fed outlook and focus turned to corporate earnings
  
  • Dow, S&P 500, and Nasdaq ended lower amid cautious sentiment.
  • AI chipmaker Nvidia was up 1% ahead of quarterly earnings report on Wednesday. 

• US Treasury yields steady ahead of debt auctions
  
  • The 10-year US Treasury yield held near 4.277%, up 1.9 bps on Monday.
  • Yields steadied after falling nearly 10 bps in previous session post-Powell’s Jackson Hole remarks.
  • Traders positioned ahead of upcoming short- and intermediate-dated debt auctions this week.

• US dollar rebounds after last week’s drop
  
  • US Dollar Index rose 0.49% to 98.32, marking its biggest daily gain since July 30.
  • Markets interpreted Powell’s speech as leaving room for policy flexibility, boosting greenback demand.

• Crude oil rises on supply concerns amid Russia-Ukraine tensions
  
  • Crude oil Prices gained as traders anticipated potential US sanctions on Russian oil.
  • Ukrainian attacks on Russian energy infrastructure added concerns over supply disruptions.

Day’s Ledger

Economic Data

• Japan Core CPI 
• US July Core Durable Goods Orders Data

Corporate Actions

• Ujaas Energy to consider bonus share issue
• Sri Lotus Developers and Realty to consider financial results
• DRC Systems India to consider fund rasing

Policy Events

• RBA Meeting Minutes 
• FOMC Member Williams Speaks  
• BoE MPC Member Mann Speaks

TICKERS TO WATCH

• PAYTM approves ₹3.0 billion for Paytm Money and ₹1.6 billion for Paytm Services as part of restructuring and exits real money gaming.
• ADITYA BIRLA CAPITAL informed that RBI clears Vishakha Mulye as MD & CEO for five years; Rakesh Singh to lead NBFC arm till July 2027.
• VIKRAM SOLAR makes stock market debut today with estimated listing at ₹369, around 10% above issue price.
• GREAT EASTERN SHIPPING to acquire Suezmax crude carrier (164,715 DWT, built 2010) and secondhand Kamsarmax dry bulk carrier by Q3 FY26.
• 3M India appoints Aseem Joshi as President & MD (Designate), effective October 13, 2025.
• TATA MOTORS informed that NCLT approves Composite Scheme of Arrangement involving group entities and shareholders.
• PROTEAN EGOV wins ₹11.6 billion UIDAI contract to set up and run district-level Aadhaar Seva Kendras.
• J&K BANK appoints Sankarasubramanian Krishnan as Non-Executive Part-Time Chairman till March 2028, subject to RBI nod.
• TAMIL NADU NEWSPRINT informed that LIC sells 0.58% stake at ₹171/share; holding now at 1.8%.

MUST READ

• Tariffs, Stimulus and Stalled Earnings Weigh on India’s Market
• Squeezed for the State, Royalty Payout Hits NMDC
• The Monetary Power of Words in Central Bank Communication
• The Big and Not Beautiful Bill for Trump Tariffs
• Why Ukraine Won’t Give Up Donetsk
• A time to handhold: Lenders must support MSMEs as tariff woes rise
• India Hires US Lobbying Firm With Trump Ties as Tariffs Loom
• India to tap Amazon, Flipkart data directly in inflation revamp, roll out services index
• US will back Ukraine's security, details being worked out, Trump says
• Intel warns US stake could hurt international sales, future grants

See you tomorrow with another edition of The Morning Edge.

Have a great trading day.

Why India’s Trade Playbook Must Go Beyond Firefighting 

India’s trade strategy is under fresh stress as the US rewrites global rules — from ending the de minimis exemption to tariff hikes that hit MSMEs hard.

Vijay Chauhan writes, what should India do?