Market watchers are rubbing their eyes this morning. Just yesterday, the S&P 500 and the Dow Jones Industrial Average were high-fiving at record-breaking levels. Then Tuesday happened. Basically, the momentum hit a wall of reality as new inflation data and big bank earnings hit the tape. It’s a classic case of "buy the rumor, sell the news," but with a side of political drama that’s making investors a bit twitchy.
Honestly, the mood on Wall Street is kinda complicated right now. We’ve got a mix of "everything is fine" inflation numbers and "wait, is that a storm cloud?" earnings reports. If you're wondering what the stock market doing today, it’s essentially a tug-of-war between relief and caution.
The Inflation Number Everyone Was Sweating
The big reveal this morning was the December Consumer Price Index (CPI). Everyone was holding their breath. Why? Because the U.S. government just came out of a roughly six-week shutdown that messed up all the data. We’ve been flying blind.
The numbers came in, and they were... fine. Not amazing, but fine. Headline inflation hit 2.7% year-over-year. That’s exactly what economists predicted. Core CPI—which ignores the roller coaster of food and gas prices—actually cooled a bit more than expected, landing at 2.6%.
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Usually, "as expected" is a snooze. Not today. It’s a relief. It means the tariffs and policy shifts from the Trump administration haven’t sparked an immediate inflationary wildfire yet. Investors are breathing a sigh of relief because this keeps the possibility of a Federal Reserve rate cut in March or April on the table. Without this cool-down, the Fed might have stayed in "wait-and-see" mode forever.
JPMorgan and the Bank Earnings Hangover
While the inflation data was a win, the earnings side of the house is looking a bit more bruised. JPMorgan Chase kicked off the Q4 reporting season, and it was a bit of a "good news, bad news" situation.
- The Profit Dip: Net income dropped to $13 billion from $14 billion a year ago.
- The Apple Factor: The bank took a big one-time hit because they agreed to take over Apple’s credit card portfolio.
- The Rainy Day Fund: They’re setting aside more cash for potential loan losses. That’s a signal they see a slight chill coming for the average consumer.
JPMorgan shares actually rose a tiny bit at first but then pared those gains. It’s like the market knows Jamie Dimon is a wizard, but even he can’t ignore a softening labor market.
Delta’s Turbulent Forecast
If you want to see where the real pain is today, look at the airlines. Delta Air Lines (DAL) got hammered, dropping about 5% after its update.
They actually beat earnings expectations for the last quarter. Usually, that’s a win. But the market is a forward-looking machine, and Delta’s 2026 guidance was basically a bucket of cold water. They’re projecting earnings between $6.50 and $7.50 per share, which is well below what the pros on Wall Street were looking for.
It turns out that while we’re all still traveling, the costs of keeping those planes in the air—and the competition for our "premium" dollars—is getting expensive.
The Powell Investigation and Political Noise
You can't talk about what the stock market doing today without mentioning the elephant in the room. Or rather, the investigation in the room.
Federal prosecutors have reportedly opened a criminal probe into Fed Chair Jerome Powell. The focus? Renovations at the Federal Reserve building. Powell has called it a "pretext" by the administration to pressure him into cutting rates faster.
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This is weird. Like, historically weird.
Investors hate uncertainty. When you have the head of the world's most powerful central bank under a legal cloud while the President is calling for a 10% cap on credit card interest rates, things get messy. The "debasement trade" is real right now—investors are scurrying into gold, silver, and even Bitcoin (which is hovering around $92,000) as a hedge against D.C. chaos.
Major Market Movers Today
- L3Harris (LHX): Up roughly 3% and hitting record highs. The Pentagon is investing $1 billion into their missile business. Defense is definitely a "safe haven" play right now.
- Travere Therapeutics (TVTX): Down a massive 30%+. The FDA asked for more data on their kidney drug. In biotech, that’s a "do not pass go" card.
- Intel & AMD: Both saw a nice bump, up 7.5% and 6% respectively, as the chip sector continues to ride the AI wave despite the broader market jitters.
Why This Matters for Your Portfolio
So, what are we supposed to do with all this?
First, don't panic about the red numbers today. The S&P 500 is still up nearly 2% for the month of January. A little "digestion" after hitting record highs is actually healthy. It prevents the market from turning into a bubble that eventually pops and hurts everyone.
Second, the Fed is the North Star. Today's CPI data confirms that they have "room to move." If the labor market continues to look sluggish—remember, we only added 50,000 jobs in December—the Fed will likely prioritize growth over fighting inflation. That’s generally good for stocks in the long run.
Third, watch the dollar. The U.S. Dollar Index is sitting around 99.14. A strong dollar is a double-edged sword. It’s a sign of U.S. strength, but it makes our exports more expensive for the rest of the world.
Your Next Steps
Stop checking your 401(k) every twenty minutes. Seriously.
Instead, keep an eye on the "Big Six" bank earnings coming later this week. If Wells Fargo and BofA echo JPMorgan’s caution about loan losses, we might see a shift away from "cyclical" stocks (like banks and retailers) and back into "defensive" plays (like healthcare and utilities).
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Also, pay attention to the credit card rate cap news. If that 10% cap actually happens on January 20th, the entire "rewards" ecosystem—those points and miles we all love—could evaporate overnight. Banks will likely hike annual fees to make up for the lost interest income.
The market is currently in a "wait and see" mode. It's waiting to see if the new administration's policies are a boost or a burden. Until then, expect more days like today: a little bit of green, a little bit of red, and a whole lot of noise.
Stay diversified. Keep some cash on the sidelines if you're looking for an entry point. And maybe keep an eye on those defense stocks—they seem to be the only ones not worried about the headlines.
Focus on the long-term trend, which is still pointing up, even if today feels a bit like a stumble.