U.S. stocks opened lower on Wednesday evening, Beijing time, as traders digested the latest batch of corporate earnings from banks. Geopolitical risks continued to cast a shadow over market sentiment. As the United States continued to signal a potential direct intervention in the Iran situation, investors once again flocked to precious metals for safety.
The Dow Jones Industrial Average fell 35.78 points, or 0.07%, to 49,156.21; the Nasdaq Composite dropped 141.044 points, or 0.60%, to 23,568.829; and the S&P 500 index declined 25.53 points, or 0.37%, to 6,938.21. Shares of Wells Fargo moved lower after the company reported fourth-quarter revenue that fell short of expectations. In contrast, Citigroup's fourth-quarter performance exceeded expectations. U.S. stocks closed lower on Tuesday, with the Dow dropping nearly 400 points. The financial sector was the worst-performing industry group. JPMorgan Chase shares closed down more than 4% as its fourth-quarter investment banking fees missed expectations. Goldman Sachs and Bank of America also fell subsequently. U.S. President Donald Trump continued his criticism of Federal Reserve Chairman Jerome Powell on Tuesday. Meanwhile, market concerns about central bank independence intensified as the U.S. Department of Justice launched a criminal investigation into the Fed Chairman. Paul Meeks, Head of Technology Equity Research at Freedom Capital Markets, suggested that stock prices might have started to reflect the potential impact of Trump's demands. "This is a delayed reaction to the threats against Chairman Powell and the bank earnings—companies are talking about setting a credit rate cap of 10%... this just creates unnecessary anxiety," he said. The veteran technology analyst also stated that Tuesday's decline could present "some good buying opportunities" ahead of upcoming 2026 earnings guidance and AI capital expenditure plans from hyperscale cloud providers. Wednesday's market faced a dense catalyst schedule: earnings from major Wall Street banks, a series of speeches from Federal Reserve officials, U.S. Producer Price Index (PPI) and retail sales data, and a potential ruling from the U.S. Supreme Court on cases related to the Trump administration's tariff policies under the International Emergency Economic Powers Act (IEEPA). Padhraic Garvey, Head of Research for the Americas at ING, noted in a report that his "base case" is that the IEEPA tariffs will be ruled invalid, and he believes the market generally holds a similar view. He pointed out that if such a ruling is issued, it would put some pressure on the Trump administration, but the government could ultimately find alternative paths to "rebuild" the tariff system. Marija Veitmane, Head of Equity Research at State Street Bank, said, "The start of the earnings season yesterday was not as ideal as we typically see. The Iran factor has significantly increased uncertainty. With multiple scenarios coexisting and having wide spans, it's difficult to directly judge cross-market transmission paths, but uncertainty has indeed risen." Focus Stocks Rivian is recalling over 19,000 electric vehicles in the U.S. and was downgraded to "Sell" by UBS. Intel's stock price rose after Trump hinted that Apple had invested in Intel. Honeywell's quantum computing division, Quantinuum, plans to file for an IPO. AstraZeneca has acquired Modella AI to accelerate oncology drug development. Bilibili's advertising revenue has grown over 20% for 11 consecutive quarters.
