New York, Jan 26, 2026, 18:01 (EST) — After-hours
Shares of JPMorgan Chase & Co (JPM.N) climbed 1.3% to finish Monday at $301.48, then slipped slightly to $301.04 in after-hours trading. The SPDR S&P 500 ETF gained 0.5%, while the financial-sector ETF rose 0.7%. Bank of America, Citigroup, Wells Fargo, Goldman Sachs and Morgan Stanley also saw shares move higher. (Yahoo Finance)
The stock is tracking the banks once more, influenced not only by interest rates but also by developments in Washington. Traders are wrestling with two conflicting factors: ongoing policy uncertainty and a persistently tight credit environment.
JPMorgan often sets the tone for the sector, meaning even minor news can ripple through the market. Investors are focused on whether legal battles over consumer banking remain limited or begin to influence how lenders price loans and vet clients.
U.S. President Donald Trump has filed a $5 billion lawsuit against JPMorgan and CEO Jamie Dimon, alleging the bank closed his accounts for political reasons—a practice dubbed “debanking” by critics. His legal action also targets lenders like Capital One, Bank of America, and Goldman Sachs. JPMorgan dismissed the suit as baseless, insisting it doesn’t shut accounts over political or religious views. The complaint follows Trump’s threat to cap credit-card interest rates at 10%, a move Dimon called an “economic disaster.” Nicholas Anthony of the Cato Institute said banks “will be more cautious moving forward,” while Columbia’s Todd Baker noted the industry “is losing as many battles as it wins.” Zacks Investment Management’s Brian Mulberry added the case probably won’t “move that needle much.” (Reuters)
The Federal Reserve is the other key factor, with its Jan. 27-28 meeting set to hold the benchmark rate steady at 3.50%-3.75%. Investors are focused on whether policymakers will adjust their outlook and whether political pressures might be creeping in as Chair Jerome Powell prepares to step down in May. (Reuters)
For banks, the trajectory of rates is straightforward. It directly impacts how much they earn on loans compared to what they shell out on deposits, and it can quickly shift market sentiment on credit quality.
Traders have scaled back expectations for Fed cuts this year, with rate futures now pricing around 44 basis points of easing in 2026 — that’s under two quarter-point reductions. “A pause makes a lot of sense,” said Tony Rodriguez, Nuveen’s head of fixed income strategy, citing fiscal policy and the delayed impact of earlier cuts. (Reuters)
However, the risk for JPMorgan and its rivals isn’t balanced. If regulators tighten consumer rates or card rules, banks would feel the hit straight in their revenue. Plus, legal battles tend to stretch out well beyond the initial stock reaction.
Wednesday brings the Fed’s decision at 2:00 p.m. ET, with Powell set to speak at 2:30 p.m. ET. Traders are also keeping an eye on updates related to the Trump lawsuit and any new cues on credit-card policy in the coming days. (Federal Reserve)
