Market Recap - Tuesday, October 14, 2025
Bank Earnings Deliver, but Big Tech Lags as Trade Tensions Return
Stocks ended today’s session mixed after a choppy day of trading. The Dow rose 0.44% and the Russell 2000 gained 1.38%, while the S&P 500 slipped 0.16% and the Nasdaq dropped 0.76%. Small-caps and cyclical/value stocks outperformed, with sectors like banks, airlines, machinery, and retail leading the way. Meanwhile, big tech names — including NVIDIA and other chipmakers — were weaker, pulling down the Nasdaq.
Earnings from major banks helped boost investor sentiment. JPMorgan, Citigroup, Goldman Sachs, Wells Fargo, and BlackRock all reported results that beat expectations, with strong trading revenue and credit card spending highlighting ongoing consumer resilience. Meanwhile, Walmart gained on news of a new AI-powered shopping experience via OpenAI, and Caterpillar surged after JPMorgan lifted its price target, citing AI-driven energy infrastructure growth. On the flip side, some high-growth software and semiconductor names underperformed, and commodity-linked sectors like copper, aluminum, and crude oil also dipped.
Treasury yields moved lower after Fed Chair Jerome Powell said inflation and employment trends haven’t changed much since the last Fed meeting — supporting expectations for two more rate cuts this year. However, renewed U.S.-China trade tensions resurfaced after aggressive new statements and actions from both sides around rare earths, port fees, and supply chains, adding some late-day volatility. Still, the market held up relatively well thanks to optimism around earnings and resilient consumer trends.
Here’s Our Take:
The start of Q3 earnings season is off to a solid start, particularly for the banks. Strength in investment banking and capital markets activity has helped offset pressure from moderating net interest income. The consumer still looks healthy, based on credit card data and company commentary, and even industrial names like Caterpillar are seeing AI tailwinds. However, the market’s rotation out of tech and into small-caps and value names suggests investors are starting to balance growth exposure with more cyclical upside.
At the same time, U.S.-China tensions remain a wildcard. Escalations around tariffs and trade restrictions — especially in sensitive areas like rare earths and shipping — could weigh on sentiment if they spill over into broader economic uncertainty. For now, though, Powell’s measured tone and expectations of continued Fed support are helping keep a floor under the market. We’ll be watching closely as more earnings roll in later this week.
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