Trump Targets Credit Card Rates, Putting Bank Profits in the Spotlight

What Trump's Proposal Could Mean for You January 13, 2026

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Washington weighs limits on credit card interest as banks and borrowers watch closely.

Good Morning,

Markets are steady near record levels, but a new policy signal out of Washington is drawing investor attention. President Trump has floated the idea of capping credit card interest rates, a move that could directly affect bank profits and consumer credit. We break down what's being discussed, why lenders are pushing back, and what investors should watch next.

A Seadrill downgrade and potential federal fraud crackdowns could rattle both energy and government contractor stocks, while ICE activity dampening local commerce may add pressure to small-cap retail and service sectors.

Don't forget to voice your opinion in my polls below.

Here are your Morning Bullets.

– Truly yours, Fred Frost

📈 Yesterday's Market Recap

Yesterday, U.S. markets showed resilience despite renewed political pressure on the Federal Reserve. Equities nudged higher, with investors seemingly hedging rather than panicking—a pragmatic response to uncertainty.

Stocks Rebound Amid Fed Criticism: Major indices climbed in early afternoon trading, with the Dow up less than 0.1%, S&P 500 gaining 0.2%, and Nasdaq up 0.5%, despite Trump's latest jab at Jerome Powell. → MarketWatch

Seadrill Downgraded by Citi: Offshore driller Seadrill (SDRL) was cut to Sell from Neutral, with a price target drop to $32 from $35, on fears of weak 2026 EBITDA guidance. → Seeking Alpha

Healthcare Sector Funding Boost: Pomelo Care secured $92M in Series C funding at a $1.7B valuation, signaling strong investor confidence in women's and children's health expansion. → Dealbreaker

📉 Daily Performance Snapshot

Index/Asset	Closing Value	Change
S&P 500	6,977.27	+10.99 (0.16%)
Nasdaq	23,733.90	+62.56 (0.26%)
Dow Jones	49,590.20	+86.13 (0.17%)
Gold	$4,586.00	+$76.00 (1.69%)
Crude Oil	$58.94	+$0.16 (0.27%)
Bitcoin	$92,013.00	+$1,318.00 (1.45%)
10-yr Treasury Yield	4.20%	+1.8 bps (0.02%)

🔭 What to Watch Today

Today's docket is packed with earnings and policy moves that could ripple through markets. Keep your eyes on these key events for potential volatility or opportunity.

JPMorgan Q4 Earnings (Pre-Market): Analysts expect $4.95 per share on $46.20 billion in revenue; dealmaking and trading revenue will be critical as rate-driven profits slow. → Benzinga

Delta Air Lines Q4 Results (Pre-Market): Projected earnings of $1.53 per share on $14.73 billion revenue; watch for travel demand signals ahead of holiday recaps. → TheStreet

Trump's Michigan Factory Visit: President Trump tours a Ford plant in Dearborn to push manufacturing, followed by a Detroit Economic Club speech—expect tariff and job market rhetoric. → ABC News

💡 Opportunity Watch

Amid the market highs and policy noise, a few under-the-radar plays are catching my eye. These trends and tickers could offer upside for those willing to look beyond the headlines.

Navitas Semiconductor (NVTS): Up over 2% premarket, NVTS is gaining traction for its energy-efficient chips powering AI data centers—Trump's utility cost focus could boost this niche. → Stocktwits
Intralogistics Robotics (Galaxis IPO): Galaxis Technology's Hong Kong IPO taps into the booming robotics market for warehouse automation—despite losses, growth potential is significant. → Benzinga

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🔥 The Big Bullet

Trump's credit card rate-cap talk puts big banks in focus

What happened: President Donald Trump said he wants to push down credit card interest rates, and the idea being discussed is a cap on how high rates can go. CNBC reported Trump is targeting credit card rates and flagged what's at stake for Capital One and other banks. Right now, many cards charge very high rates, especially for people who carry a balance from month to month. The plan is not a law yet, and it would likely need action from Congress and federal agencies. Bank executives and policy watchers told CNBC that the enforcement path for a rate cap is still unclear, which makes the timeline hard to pin down. Investors are paying attention because credit cards are a major profit source for several lenders. Some consumer groups like the idea because it could lower monthly interest costs for borrowers. But banks warn that a hard cap could change who qualifies for credit and how much credit is offered.

Why it matters: A national rate cap would be a direct hit to one of the highest-margin parts of consumer banking. If banks earn less interest, they may try to make up the gap with higher fees, tighter limits, or stricter approval rules. That could matter most for people with lower credit scores, who already face the highest rates. Any big shift in card profits can also move bank stock prices, especially when policy headlines are driving sentiment. TheStreet noted a separate White House move that shocked Wall Street's favorite banks, showing how quickly politics can land on the sector. On Capitol Hill, Senator Elizabeth Warren argued that Congress has the power to cap credit card rates if the president backs it. For markets, the key issue is not just the headline, but whether the proposal turns into real rules. Even talk of a cap can make investors re-check earnings forecasts for lenders that rely heavily on card interest.

What's next: Watch for details: the exact cap level, which types of cards it would cover, and whether it would apply to existing balances or only new charges. Also watch for formal steps, like draft legislation, committee hearings, or agency comments that show the plan is moving forward. Short-term market reactions may show up in bank and consumer-finance stocks; CNBC tracked stocks making the biggest moves midday as investors digested fresh headlines. Earnings season can add fuel, since banks will be asked about credit-card growth, late payments, and pricing plans. If lenders pull back on credit, that can cool consumer spending over time, which feeds into the wider economy. TheStreet also highlighted worries that the market may be overlooking recession risks, so any change to consumer credit could get extra attention. Keep an eye on credit-card delinquency trends and charge-off rates, since higher losses can make banks even more sensitive to policy changes. Finally, listen for how regulators describe their authority, because that will shape whether this becomes a real market-moving rule or just a political message.

Reader Feedback

Yesterday, I asked you: How concerned are you about politics affecting the Federal Reserve's decisions?

The majority of you at 22% said "Very concerned — politics should stay out of the Fed"

Chris from Maine replied: "I'm very worried because politics shouldn't mess with the Fed and how it makes money decisions."

Here's what I'm asking you today:

If the government caps credit card interest rates, who would be hurt the most?

Big banks

Credit card users with low credit scores

The overall economy

Not sure / no opinion

Other

As always if your opinion is not here, or you want to throw your two cents at me, reply to the E-mail, and let me know your exact thoughts.

🧭 Policy & Market Ripples

Seadrill's EBITDA Warning: Citi's downgrade to Sell on expectations of weak 2026 guidance could weigh on energy sector sentiment, especially for offshore drillers. → Seeking Alpha
Federal Fraud Hearing Impact: Today's House hearing on fraud prevention may signal tighter controls on federal spending, a potential headwind for contractors reliant on government funds. → Daily Signal
ICE Actions Hit Local Economies: Business closures and reduced foot traffic due to ICE operations are denting revenues in immigrant-heavy communities—small business stocks may feel the pinch. → TheStreet

📜 This Day in History – January 13

January 13 has a cartographer's bias: measure the world, publish it widely, and build the institutions that make "knowledge" and "markets" less guesswork and more system.