NEW YORK, Feb 1, 2026, 13:19 EST — Market closed.
- U.S. financial services stocks fell on Friday, dragged down mainly by card and payments companies.
- After Donald Trump nominated Kevin Warsh to head the Federal Reserve, investors are reassessing their rate forecasts.
- The January jobs report, along with a packed slate of U.S. data this week, will drive yields and risk appetite.
The Financial Select Sector SPDR ETF (XLF), tracking U.S. financial services stocks, closed Friday around 0.2% lower at $53.44. Visa dropped about 3%, American Express dipped nearly 2%, and Mastercard also edged down. JPMorgan Chase & Co. and Goldman Sachs Group saw slight declines.
That late-week slide carries over into Monday, as the sector now reacts more to interest rates than earnings. Trump’s pick of Warsh for Fed chair thrusts the debate over policy direction—and Fed independence—back into the spotlight for rates traders. “He was considered a hawk,” Cardillo noted, but the market will watch closely “whether or not he will be influenced by the White House.” Reuters
The upcoming data calendar is packed. Trading Economics highlighted several key releases: the January U.S. jobs report, JOLTS job openings, ADP employment figures, and ISM business surveys. On top of that, the Treasury’s quarterly refunding announcement is also due — any of these could send yields swinging.
Friday unfolded with a risk-off tone. U.S. stocks slipped as investors digested the Warsh nomination, mixed earnings news, and a stubbornly high inflation report. On top of that, strategists flagged fresh concerns over a potential government shutdown. “Markets are calibrating” to the Warsh pick and what it means for rates, said Michael Hans of Citizens Wealth. Reuters
Rates didn’t hold steady. Yields on longer-dated U.S. Treasuries crept up, with the 10-year climbing roughly 2.4 basis points to 4.251%. Meanwhile, the odds of a rate cut barely budged after the nomination, with CME’s FedWatch tool still showing less than even chances of a cut before June.
Visa posted solid first-quarter results, beating estimates as global payment volumes climbed 8%, with cross-border volumes up 12%—though that growth has slowed compared to last year. Despite the positive numbers, the stock faced pressure. Evercore ISI suggested shares dipped due to a “higher opex guide” and “some weakness in cross-border trends.” (Opex refers to operating expenses.) Reuters
American Express offered a second glimpse into consumer trends — strong demand at the top end, more uneven elsewhere. The company set its 2026 earnings per share forecast between $17.30 and $17.90, but a slight profit miss dragged shares down. Billed business was up 9%, with revenue climbing 10% to $18.98 billion. CFO Christophe Le Caillec told Reuters, “We’re not projecting any discontinuity,” yet Truist noted the quarter reflected the “cost of the Platinum refresh” without a clear lift in new accounts. Reuters
Big lenders also had fresh corporate housekeeping to chew on. Wells Fargo revealed that CEO Charlie Scharf’s pay for 2025 jumped 28% to $40 million. It’s a sharp reminder that compensation and governance issues can disrupt valuation debates, even when rates dominate the trading narrative.
Bank of America faces more legal trouble than macro risks this weekend. A U.S. judge ruled the bank must answer parts of a proposed class action lawsuit alleging it profited from Jeffrey Epstein’s sex trafficking by providing banking services. The judge said a detailed opinion on the decision will come by Feb. 13, with a trial scheduled for May 11.
Charles Schwab is gearing up for a leadership shift. The company announced that Paul Woolway, CEO of Schwab Bank, will retire on July 1, 2026. Tyler Woulfe is set to take over the role.
Still, the sector faces immediate risks tied to rates and regulation. Any unexpected moves in wages or employment from the jobs report could shift rate-cut expectations and send yields tumbling, hitting rate-sensitive financials hard. On top of that, the proposed credit-card interest-rate cap lingers as a potential threat if it gains traction.
The first key data arrives Monday, Feb. 2, with the ISM manufacturing survey. The bigger event comes Friday, Feb. 6, when the U.S. releases its January jobs report. Financial services stocks will be watching closely to see if these figures support the view of higher-for-longer yields or revive hopes for quicker rate cuts—right as Warsh’s confirmation hearings begin to take shape.
