US stocks closed lower on Tuesday, with the Dow Jones falling nearly 400 points as JPMorgan dropped more than 4%. Concerns over central bank independence remained in focus, while markets continued to digest a series of policy proposals from President Trump that have increased volatility.
Data from the US Bureau of Labor Statistics showed December CPI rose 0.3% month on month and 2.7% year on year, both in line with expectations. The figures reinforced market expectations that the Federal Reserve will deliver at least two rate cuts in 2026 to support the labor market.
Several JPMorgan executives, including CEO Jamie Dimon, warned that Trump’s proposal to cap credit card interest rates at 10% would significantly hurt consumers. The proposal, which would take effect from January 20 for one year, reignited selling across financial stocks.
Visa and Mastercard also sold off sharply, making financials one of the biggest drags on the S&P 500. Tim Ghriskey, senior portfolio strategist at Ingalls & Snyder, said financial stocks were being hit hard by the credit card proposal, even if it may be difficult to implement.
With US indices near record highs, companies are under pressure to deliver strong earnings to justify valuations. JPMorgan and Delta Air Lines officially kicked off earnings season, with analysts expecting S&P 500 earnings to grow 8.3% year on year in the final quarter of 2025.
US Stocks
D Prime Market Watch:
Major tech stocks were mixed. Intel surged over 7% to a two-year high, while Alphabet gained 1.24%, Nvidia rose 0.47% and Apple added 0.31%. Tesla slipped 0.39%, Microsoft fell 1.36%, Amazon dropped 1.57% and Meta declined 1.69%.
Chinese ADRs were mostly lower. The Nasdaq Golden Dragon Index fell 1.86%, with Pinduoduo down over 5%, while NIO and XPeng fell more than 3%. JD.com, Li Auto, Baidu and Bilibili also posted losses.
D Prime US Stocks Snapshot:
- Dow Jones: −398.21 (−0.80%) to 49,191.99
- Nasdaq: −24.03 (−0.10%) to 23,709.87
- S&P 500: −13.56 (−0.19%) to 6,963.71
Hong Kong Stocks
Hong Kong markets rose across the board by midday, led by internet and healthcare stocks. Kuaishou and Alibaba jumped over 5%, Bilibili gained more than 4%, while Baidu rose over 2%.
D Prime Insight:
AI healthcare stocks surged, with Alibaba Health jumping more than 15%. Market sentiment was driven by growing confidence in the sector after Ant Group’s AI health assistant reached over 30 million monthly users, while OpenAI also launched ChatGPT Health, highlighting global momentum in AI healthcare.
Brokerage stocks also climbed, led by Sinolink International. Bank of America noted that policy support, capital inflows and easing financial conditions are improving earnings and return on equity for Chinese brokers.
D Prime Hong Kong Market Snapshot:
- Hang Seng Index: +0.92% to 27,094.31
- Hang Seng Tech Index: +1.54% to 5,960.07
- China Enterprises Index: +0.89% to 9,367.75
A50 / China Markets
Mainland Chinese stocks rallied strongly. The Shanghai Composite rose 1.2%, Shenzhen climbed 1.98%, and the ChiNext gained 2.24%, with the Beijing Stock Exchange 50 up nearly 3%.
D Prime Insight:
Healthcare services, AI applications and internet finance led gains, while banking stocks underperformed.
D Prime China Market Snapshot:
- Shanghai Composite: +1.20% to 4,188.24
- Shenzhen Component: +1.98% to 14,449.57
- ChiNext Index: +2.24% to 3,396.35
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