Stocks Rebound on Cool CPI, Solid JPMorgan Results

Published as of: January 13, 2026, 9:12 a.m. ET

(Tuesday market open) Bank earnings got underway today with better-than-expected results from JPMorgan Chase (JPM), which shared the spotlight with December's Consumer Price Index (CPI). A 0.3% rise in CPI was in line with consensus, while core CPI growth of 0.2% excluding food and energy came in slightly below analysts' thinking. On an annual basis, CPI rose 2.7%, also meeting expectations, and core growth of 2.6% was the lowest since 2021. Major indexes, which had been dragging before the report, edged up on the news but hugged the flatline, and odds of a January rate cut remained on ice near 5%, according to the CME FedWatch Tool.

"The month-over-month CPI numbers were better than expected," said Cooper Howard, director of fixed income research and strategy at the Schwab Center for Financial Research, or SCFR. "It's a bit of a mixed bag because of the government shutdown, so there are some distortions that the market will have to sort through." Data collected in October and November was affected by the shutdown, casting doubt on the accuracy of December's comparison figures. Diving into those, shelter and energy costs contributed most to the monthly increase, with shelter up far more than expected while used car and truck prices fell, Cooper noted. The report showed little progress toward the Fed's 2% inflation goal, but in their latest set of projections, Federal Reserve policy makers seem confident inflation can fall to near that level by late this year and achieve it by the end of 2027.

On Monday, stocks initially fell but finished the day at new highs for the S&P 500 index. The quick turnaround after early weakness on Fed independence concerns might be chalked up to a bullish investor base that views pullbacks as an opportunity to buy.

1. JPMorgan earnings deeper dive: Investors appeared initially nonplussed by JPMorgan Chase earnings, with shares moving little in pre-market action. The company exceeded earnings and revenue expectations but recorded a one-time charge it had announced previously reflecting its takeover of the Apple Card loan portfolio from Goldman Sachs (GS), which affected unadjusted earnings per share. Net-interest income, an important element for banks, rose 4% at JP Morgan in the fourth quarter. "Each line of business performed well," said Jamie Dimon, CEO, in the company's news release, adding that the U.S. economy "remains resilient" and "conditions do not appear to be worsening." The bank's trading business looked particularly strong, possibly reflecting last quarter's record stock market highs. That could bode well for other major banks with large trading operations reporting this week. JPMorgan is the biggest bank and leads a parade of financial earnings from large and small institutions this week continuing tomorrow morning with Bank of America (BAC), Wells Fargo (WFC), and Citigroup (C). Fundamentals may need to be robust to match the sector's recent Wall Street gains, and loan demand could get a close look.
    
2. White House proposals on defense, housing face push back: Defense industry stocks including Lockheed Martin (LMT) and Northrop Grumman (NOC) posted appreciable gains late last week after President Trump called for a 50% increase in the defense budget. That was a whipsaw from earlier last week, when defense stocks fell after Trump said he "will not permit" defense companies to issue dividends or stock buybacks. It's unclear, however, if the president has the authority to prohibit firms from such activities. He also tried to ban large institutional investors from buying single-family homes, which might require congressional approval. "These moves are part of a pattern with this administration of pushing the limits of executive power," said Michael Townsend, managing director of legislative and regulatory affairs, Schwab. "But Congress is likely to have a lot to say about some of these plans, and a number of pending court cases to be decided in the coming months may also put some limits on the administration." In other Washington news, the Supreme Court plans to issue a new batch of decisions tomorrow, increasing speculation that the case on Trump's tariffs could get a ruling this week. A decision against Trump could trigger a massive and complicated refund process for about $150 billion in tariffs paid to date.
    
3. Dollar up in 2026 despite D.C. turmoil: Metals and bitcoin (/BTC) climbed Monday in what's been called the "debasement trade," where investors seek assets unrelated to the U.S. dollar. Gold and silver hit new highs, which could mean investors remain frazzled about the dollar. For its part, the dollar fell Monday but has climbed since the start of the year. Also, two Treasury auctions went well yesterday, a sign that investors aren't fleeing in droves from U.S. paper. Silver (/SI) extended its gains early Tuesday but rose less than 1% while gold (/GC) fell and copper (/HG) moved little. Mining stocks including Hecla Mining (HL) and Freeport McMoRan (FCX) gained a little under 1% Tuesday morning. Treasury yields rose and the dollar fell Monday after news that the Justice Department launched an investigation into Fed Chairman Jerome Powell, centering on Fed building renovations. The 10-year Treasury note yield climbed slightly this morning, flirting with near-term highs near 4.2%, and possibly weighing on stocks, but then retreated to 4.17% after the relatively cool CPI data. Odds of a Fed rate cut hope by April rose slightly in futures trading.

Bitcoin (/BTC) had a tepid start Tuesday, bobbing along just above unchanged at around the $92,000 mark. That's well below this year's highs above $95,000. Cryptocurrencies appeared to benefit slightly yesterday from "debasement" trading. For its part, the dollar rose slightly this morning and the U.S. dollar index clawed back above 99.
 

Delta Air Lines (DAL) plunged 5% despite the company reporting quarterly earnings per share that beat Wall Street's estimates. Revenue came in as expected, but the midpoint of the carrier's full-year 2026 profit forecast came up short of estimates, Bloomberg noted. Also, Delta expects free cash flow of $3 billion to $4 billion, below the $4.6 billion it took in last year. Demand for premium seating stayed strong in the fourth quarter and the company expects double-digit growth in corporate travel in the first part of 2026.
 

Walmart (WMT) jumped 3% Monday after Walmart and Alphabet (GOOGL) shared plans to launch a new experience that pairs Google's Gemini with Walmart and Sam's Club. Walmart might also have gotten a boost from news of its inclusion into the Nasdaq-100 index (NDX), which means its shares could be listed among exchange-traded funds (ETFs) that track that index.
 

Palantir (PLTR) rose 1% Monday on an upgrade from Citigroup, which cited accelerating enterprise and government demand.

Arm Holdings (ARM) fell 2% ahead of the open after receiving a downgrade to neutral from buy at Bank of America. Global smartphone units could decline low-single digits year-over-year, versus up low-single digits in 2025, on increased memory costs and supply constraints, the analyst noted.
 

Intel (INTC) gained 3.6% before the open following an upgrade by KeyBanc to overweight from sector weight. The company is largely sold out of server central processing units in 2026, the analyst told investors in a research note. The firm expects "outsized" data center demand from hyperscalers this year to be a "significant tailwind" for Intel's data center and AI revenue.
 

Many other semiconductor stocks also moved up this morning, led by Advanced Micro Devices (AMD) with a 3% rise. AMD, like Intel, received an upgrade from KeyBanc to overweight from sector weight.
 

Crude oil (/CL) hit two-month highs above $60 per barrel early today on concerns that Iran may reduce exports during a crackdown on anti-government protesters.

Powell could stay longer at Fed: The investigation into Fed building renovations by the Department of Justice escalates the ongoing pressure campaign President Trump has waged on Fed Chairman Jerome Powell for lower rates, and raises questions that are likely to be concerning for the markets about whether the Fed can remain independent of political pressure, my colleague Townsend notes in his new "Washington: What to Watch Now" column. "Powell's term as chair ends in May, but his term as a regular Fed governor continues until January 2028," Townsend writes. "Historically, chairs have not stayed on as governors after their term ends, but this situation may increase the chances that Powell does so, as staying on would prevent the president from appointing a new Fed governor."

As banks report, watch for AI impact: Bank reporting season comes after a strong quarter for the sector. Though bank shares normally don't move much on earnings, and expected strong results may be somewhat factored into prices, one thing that could possibly move the needle is any news from banks on how they've successfully incorporated AI technology to grow more efficient and save costs, said Alex Coffey, senior trading and derivatives strategist at Schwab, in Schwab's financial sector earnings preview.
 

Handling equity compensation: Many companies offer equity compensation as part of a salary package. It's tempting to see this as a cash windfall to spend freely. But it isn't just money. It's a chance to share in the ownership—and growth—of the company you work for. Schwab's latest feature describes three areas to focus on if you receive shares of your company's stock, including tax implications and how long you might consider keeping shares once they vest.

The 10-year Treasury note yield (TNX:CGI–candlesticks) flirted with 4.2%, the high end of its four-month trading range (red lines), on Monday as investors fretted over possible threats to Fed independence. The yield hasn't dropped under 4.1% since early December and hasn't been below 4% since late November. The blue line shows the 200-day moving average of 4.23%, just below levels near 4.25% that some analysts think might pose a threat to bullish vibes on Wall Street, though some think it would take a move to 4.5% or above to have a major impact on stocks.

Check out the investors' calendar for a summary of the top economic events and earnings reports on tap this week.

January 14: December Producer Price Index (PPI), retail sales, Fed Beige Book, and earnings from Bank of America (BAC), Wells Fargo (WFC), and Citigroup (C).

January 15: Expected earnings from Morgan Stanley (MS), Goldman Sachs (GS), BlackRock (BLK), and First Horizon (FHN).

January 16: December industrial production and expected earnings from PNC Financial (PNC), State Street (STT), M&T Bank (MTB), and Regions Financial (RF).

January 19: No data or earnings, markets closed in observance of Dr. Martin Luther King Jr.'s birthday.

January 20: Expected earnings from 3M (MMM), U.S. Bancorp (USB), Fastenal (FAST), D.R. Horton (DHI), Fifth Third Bancorp (FITB), KeyCorp (KEY), Netflix (NFLX), Interactive Brokers Group (IBKR), and United Airlines (UAL).