New York, Jan 20, 2026, 19:15 EST — After-hours
- Morgan Stanley shares ended 3.7% lower at $182.10, holding steady in after-hours trading
- Bank stocks fell amid investor concerns over a proposed 10% limit on credit-card interest rates
- Traders are focused on Davos headlines and upcoming tariff deadlines
Morgan Stanley (MS) shares dropped $7.05, or 3.7%, closing Tuesday at $182.10. They held steady in after-hours trading. During the session, the stock fluctuated between $181.30 and $187.48.
The sell-off followed a dip in U.S. bank shares as investors braced for a Trump administration deadline to enforce a 10% cap on credit-card interest rates. Banks argue this limit would squeeze their interest income—the gap between loan earnings and funding costs. “For now, it’s an overhang, but that overhang could clear quickly,” said Brian Jacobsen, chief economic strategist at Annex Wealth Management. (Reuters)
Morgan Stanley was swept up in a broader risk-off move after Trump threatened new tariffs on several European nations amid his push for U.S. control over Greenland. The S&P 500 fell 2.06%, the Nasdaq dropped 2.39%, and the VIX volatility index climbed to an eight-week peak. “It’s all coming together for a pretty significant risk-off day,” said Wasif Latif of Sarmaya Partners. (Reuters)
The stock closed 5.49% below its 52-week high of $192.68 set on Jan. 16. Trading volume hit 11.3 million shares, about twice the 50-day average, according to MarketWatch data. (Marketwatch)
The selloff follows Morgan Stanley’s latest quarter, where it outperformed profit forecasts thanks to a surge in investment banking fees. Investment banking revenue climbed 47% to $2.41 billion, Reuters reported. CFO Sharon Yeshaya told Reuters the bank is observing “an accelerating pipeline in M&A and IPOs.” (Reuters)
The bank’s board announced a $1.00 quarterly dividend in its earnings release, set to be paid on Feb. 13 to shareholders recorded by Jan. 30. It bought back $1.5 billion of stock in the fourth quarter and $4.6 billion over the year. The record date determines which investors are eligible for the dividend. (Morganstanley)
For Morgan Stanley, the core issue isn’t just credit cards—it’s the sentiment surrounding the policy debate. Stricter rules or a prolonged legal battle might weigh on bank shares, despite trading and underwriting gaining from occasional market swings. Should tariff threats become reality and investors retreat, deal flow might slow down, undermining the momentum that boosted the stock earlier this month.
Investors are turning their attention to Wednesday’s Davos summit, where Trump is set to speak, and whether his tariff threat will materialize into a policy change on February 1, according to Deutsche Bank analysts led by Jim Reid. Morgan Stanley shareholders should note that January 30 is the record date for the upcoming dividend. (Reuters)
