5 Must-Knows Before Tuesday’s Stock Market Open

As a new corporate earnings season kicks off, U.S. stock futures are trading lower this morning after a largely positive session. Investors are navigating a landscape shaped by evolving geopolitical tensions, significant corporate announcements, and the ever-present influence of Federal Reserve policy.

Here are five key developments shaping the market today:

### 1. Resilience Amidst Headline Risk

Despite a criminal investigation into Federal Reserve Chair Jerome Powell dominating business headlines, the U.S. stock market demonstrated remarkable resilience, reaching new record highs. This suggests that while the news generated significant attention, its immediate impact on investor sentiment was less severe than some might have anticipated. The market’s ability to absorb such news and push higher underscores a broader confidence in the underlying economic recovery, or perhaps a growing investor appetite for risk despite the uncertainties.

### 2. Financial Giants Kick Off Earnings Season

JPMorgan Chase exceeded analyst expectations for both revenue and earnings in the fourth quarter, driving its shares up in pre-market trading. The bank also reported stronger-than-expected trading revenue, a key segment often seen as a bellwether for market activity and institutional demand.

JPMorgan’s performance sets the tone for a week packed with earnings reports from other major financial institutions, including Bank of America, Citigroup, Wells Fargo, Goldman Sachs, and Morgan Stanley. These reports will offer crucial insights into the health of the financial sector, consumer spending habits, and the broader economic outlook.

The banking sector has recently faced pressure following a proposal to cap credit card interest rates. Industry executives are reportedly developing contingency plans, as such a move could significantly impact their business models. The ability of these banks to maintain profitability amidst regulatory scrutiny and evolving consumer finance landscapes will be a critical theme in their earnings calls.

### 3. Aviation Sector Navigates Demand and Costs

Delta Air Lines experienced a notable dip in its stock price this morning after reporting fourth-quarter revenue that slightly missed Wall Street’s projections. However, the airline managed to surpass earnings per share expectations and offered an optimistic outlook, projecting a significant 20% increase in earnings per share for the full year 2026, with an even stronger 50% surge anticipated for the first quarter.

This projection is bolstered by robust demand for both leisure and business travel, indicating a strong rebound in the travel industry. However, the sector continues to grapple with operational costs and the potential for economic headwinds that could impact consumer discretionary spending. Delta’s ability to translate strong booking trends into consistent profit growth will be closely watched by investors in the airline and broader transportation sectors.

### 4. Geopolitical Tensions and Trade Policy

President Trump announced a sweeping 25% tariff on any country engaging in business with Iran, effective immediately. This policy appears designed to further isolate Iran economically, coming on the heels of threats of military action. The lack of immediate detail regarding the implementation and scope of these tariffs creates a layer of uncertainty for international trade and specific industries that may have indirect exposure to Iran. Businesses operating in or with countries that have significant trade ties with Iran will need to assess their supply chains and operational strategies in light of this new trade directive. This move underscores a broader trend of using economic tools to achieve foreign policy objectives, a strategy that can lead to complex and cascading effects across the global economy.

### 5. The AI Arms Race: Apple and Alphabet Forge Ahead

In a significant development in the artificial intelligence landscape, Apple is integrating Alphabet’s Gemini models to enhance its virtual assistant, Siri. This partnership is expected to roll out later this year, marking a substantial upgrade to Siri’s capabilities. This move represents another victory for Google in the competitive AI arena, particularly against rivals like OpenAI.

The integration of advanced AI models into consumer-facing products like Siri is a critical step in making AI more accessible and functional for everyday users. This development not only highlights the rapid advancements in large language models but also the strategic collaborations emerging as tech giants vie for leadership in AI innovation. The success of this integration could set new benchmarks for virtual assistants and influence future product development across the technology sector.

Furthermore, Alphabet’s shares saw a surge following the announcement, contributing to its milestone achievement of reaching a $4 trillion market capitalization. This positions Alphabet as a dominant force in the market, driven by its AI advancements and its expansive ecosystem of products and services. The sustained growth trajectory for Alphabet, particularly in its AI endeavors, signals a significant shift in market dynamics and investment focus towards companies at the forefront of technological innovation.