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U.S. Stocks End Tuesday in Negative Territory
(MENAFN) American stock markets slid Tuesday as the earnings reporting period for the fourth quarter kicked off with lackluster financial results from a leading bank, while investors digested new price data and continuing political uncertainty over lending regulations.
The Dow Jones Industrial Average declined 398.21 points, or 0.8 percent, closing at 49,191.99. The S&P 500 shed 13.53 points, or 0.19 percent, settling at 6,963.74, while the Nasdaq Composite Index retreated 24.03 points, or 0.1 percent, finishing at 23,709.87.
Banking stocks drove the selloff. JPMorgan Chase, America's largest bank by assets, disclosed quarterly profits that missed analyst projections, weighed down by a 2.2 billion U.S. dollar charge connected to its Apple Card collaboration. JPMorgan shares crashed 4.19 percent, dragging Goldman Sachs down 1.2 percent in sympathy.
Financial institutions faced additional headwinds from persistent questions surrounding U.S. President Donald Trump's recently unveiled proposal to impose a 10 percent ceiling on credit card interest rates. JPMorgan CFO Jeremy Barnum indicated the banking sector may push back against the initiative, which was announced late last week.
Meanwhile, energy and consumer staples sectors defied the broader market weakness, climbing 1.53 percent and 1.08 percent, respectively. Seven of the 11 primary S&P 500 sectors managed to post gains despite the benchmark indexes' retreat.
The Bureau of Labor Statistics released consumer price index figures showing U.S. inflation remained unchanged in December 2025. The headline annual rate held at 2.7 percent, while core inflation, stripping out unpredictable food and energy prices, increased 2.6 percent year-over-year—the smallest annual advance since early 2021.
"Distortions caused by the government shutdown have made the inflation data harder to interpret, but the recent run of figures suggests inflation has peaked," said Michael Pearce, chief U.S. economist at Oxford Economics. "We think tariff-driven price rises have mostly been passed through and anticipate further disinflation in services inflation in 2026 will drive inflation back closer to the 2 percent target by the end of the year."
The CME FedWatch Tool indicates that market participants, responding to stable inflation and a softening employment picture, now expect the Federal Reserve to hold rates steady at its late January meeting, with the first of two projected rate reductions likely arriving in June.
The Dow Jones Industrial Average declined 398.21 points, or 0.8 percent, closing at 49,191.99. The S&P 500 shed 13.53 points, or 0.19 percent, settling at 6,963.74, while the Nasdaq Composite Index retreated 24.03 points, or 0.1 percent, finishing at 23,709.87.
Banking stocks drove the selloff. JPMorgan Chase, America's largest bank by assets, disclosed quarterly profits that missed analyst projections, weighed down by a 2.2 billion U.S. dollar charge connected to its Apple Card collaboration. JPMorgan shares crashed 4.19 percent, dragging Goldman Sachs down 1.2 percent in sympathy.
Financial institutions faced additional headwinds from persistent questions surrounding U.S. President Donald Trump's recently unveiled proposal to impose a 10 percent ceiling on credit card interest rates. JPMorgan CFO Jeremy Barnum indicated the banking sector may push back against the initiative, which was announced late last week.
Meanwhile, energy and consumer staples sectors defied the broader market weakness, climbing 1.53 percent and 1.08 percent, respectively. Seven of the 11 primary S&P 500 sectors managed to post gains despite the benchmark indexes' retreat.
The Bureau of Labor Statistics released consumer price index figures showing U.S. inflation remained unchanged in December 2025. The headline annual rate held at 2.7 percent, while core inflation, stripping out unpredictable food and energy prices, increased 2.6 percent year-over-year—the smallest annual advance since early 2021.
"Distortions caused by the government shutdown have made the inflation data harder to interpret, but the recent run of figures suggests inflation has peaked," said Michael Pearce, chief U.S. economist at Oxford Economics. "We think tariff-driven price rises have mostly been passed through and anticipate further disinflation in services inflation in 2026 will drive inflation back closer to the 2 percent target by the end of the year."
The CME FedWatch Tool indicates that market participants, responding to stable inflation and a softening employment picture, now expect the Federal Reserve to hold rates steady at its late January meeting, with the first of two projected rate reductions likely arriving in June.
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