NEW YORK, January 12, 2026, 12:34 EST — Regular session.
- Financial stocks dragged the Dow down slightly by midday, putting pressure on blue chips.
- Traders are digesting new pressure on the Federal Reserve alongside a proposed cap on credit-card rates.
- All eyes shift to Tuesday’s U.S. inflation report and the initial batch of major bank earnings.
The Dow Jones Industrial Average slipped roughly 100 points, or 0.2%, near midday. The S&P 500 held steady, and the Nasdaq edged up slightly. 1
Sentiment turned as new political pressure mounted on the Federal Reserve—something traders usually overlook until it becomes unavoidable. Fed Chair Jerome Powell is now grappling with possible indictment linked to his testimony about a renovation project, though he has publicly denied any wrongdoing. 2
Financial stocks slid as President Donald Trump proposed a one-year 10% cap on credit-card interest rates beginning Jan. 20, which could seriously cut into lenders’ profit margins. UBS Global analysts noted that implementing such caps would require an Act of Congress, highlighting the legal challenges to any unilateral action. 3
Some analysts didn’t mince words. Mike Mayo at Wells Fargo warned the proposed cap “could wipe out earnings from cards for a year,” he wrote in a note. 4
American Express and Visa led the losses on the Dow in early trading, showing how the price-weighted index swings more with higher-priced stocks. 5
Investors moved toward safer bets. Gold and silver hit new highs as Powell’s remarks rattled markets, the Wall Street Journal reported. 6
Investors tracking the Dow through the SPDR Dow Jones Industrial Average ETF Trust (DIA) saw it slip roughly 0.2%, landing at $493.96. The ETF dipped to a low of $490.08 earlier in the day.
Earnings will be the next hurdle. According to the Financial Times, analysts project the top five U.S. banks to generate nearly $10 billion in investment-banking revenue for the fourth quarter, leaving little margin for error in their forecasts and guidance.
Traders are eyeing the Labor Department’s December consumer price index, set to drop at 8:30 a.m. ET Tuesday, looking for signs inflation is easing enough to warrant looser policy. 7
There’s a downside scenario that’s easy to imagine. If inflation stays higher than forecast, or if Washington’s push on the Fed and consumer credit hardens into actual policy, the Dow—weighted heavily toward financials—could face ongoing pressure.
Next on the docket: Tuesday’s CPI release, along with the first major bank earnings and conference calls. These will be key to gauging how executives and investors are sizing up the rate-cap proposal.
