MW Follow the White House as it picks stock-market winners and losers, says Fundstrat's Tom Lee.

By Barbara Kollmeyer

DC is flagging just one winner so far

Fundstrat's Tom Lee says investors would be wise to follow signals from Washington when it comes to stocks in the new year.

Major indexes tripped up and broke a three-session win streaks as it seems geopolitics and worries over Fed independence might be starting to rattle investors. That's as earnings season kicks off with big banks.

Our call of the day from Fundstrat's head of research Tom Lee says investors would be wise to following the White House to determine outperforming stocks early in the year.

And while incoming data is looking dovish for monetary policy thus far, the "bigger story is Washington is picking winners and losers," Lee told clients in a video update.

Lee lists the three "losers" as credit-card companies, the Federal Reserve and institutional buyers of mortgages. Capital One $(COF)$, Synchrony Financial (SYF), Citigroup (C), JPMorgan Chase $(JPM)$ and Bank of America (BAC) all took a hit early Monday after President Donald Trump called for a 10%, one-year cap on interest rates for credit cards.

"I guess the thinking is of course, reduce the cost to borrowers," said Lee. However, quoting Tom Block, former lobbyist for JPMorgan, this means banks must be careful about credit risk, so only their best customers will get those credit cards.

"So actually, I think this is credit contracting," Lee said.

The second "loser," surrounds a criminal inquiry into Fed Chairman Jerome Powell by the Department of Justice over his testimony to Congress, which has sparked outcry on Wall Street and led to several global central banks standing in in solidarity with the Fed chief.

Lee said an independent Fed is important, so investors need to wait and see how that plays out.

"Keep in mind, it's tough to buy things that Washington decides are losers, because last year Washington decided healthcare and consulting companies were losers with DOGE and those stocks had a very difficult time," he said.

One winner he flagged was mortgage rates, as Trump has been amping up a drive towards affordability for Americans, with midterm elections looming in November. Earlier this month, Trump said he wanted to keep institutional investors from purchasing single-family homes and also wants to bring mortgage rates down through large purchases of mortgage bonds.

As for what else to own, Lee is looking specifically at stocks that benefit from a stronger 2026. That's energy and basic materials, the Magnificent 7 technology stocks, bitcoin and Ethereum - note Lee is chairman of Ethereum treasury company BitMine Immersion Technologies (BMNR).

Lee also likes industrials and financials even with credit-card headlines - large-cap and regional banks - as well as small-caps.

The markets

U.S. stock futures (ES00) (YM00) (NQ00) are lower, with silver (SI00), gold (GC00) and oil (CL00) higher.

   Key asset performance                                                Last       5d     1m     YTD    1y 
   S&P 500                                                              6963.74    0.27%  2.40%  1.73%  19.18% 
   Nasdaq Composite                                                     23,709.87  0.69%  2.59%  2.01%  24.50% 
   10-year Treasury                                                     4.176      1.70   1.30   0.40   -48.10 
   Gold                                                                 4640.2     2.99%  7.11%  7.11%  72.30% 
   Oil                                                                  60.63      6.42%  9.90%  5.61%  -21.15% 
   Data: MarketWatch. Treasury yields change expressed in basis points 

The buzz

Bank of America (BAC) beat fourth-quarter earnings and saw broad-based revenue growth. Wells Fargo $(WFC)$ and Citigroup (C) earnings are also being released after JPMorgan beat estimates on Tuesday.

BP $(BP)$ said will take an impairment charge of up to $5 billion over its renewables arm.

Cybersecurity firms Fortinet $(FTNT)$ and Palo Alto Networks (PANW) are dropping on a report Beijing has told Chinese firms to stop using those U.S. and Israeli companies.

Delayed November retail sales and producer prices are due at 8:30 a.m., followed by December existing-home sales at 10 a.m. The Fed's Beige Book is due at 2 p.m.

Minneapolis Fed Pres. Neel Kashkari will speak at 11 a.m., Atlanta Fed Pres. Raphael Bostic at 12 noon and Fed Gov. Stephen Miran at 12:30 p.m.

The Supreme Court may finally announce its ruling on President Donald Trump's tariffs on Wednesday.

Best of the web

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The chart

This chart shared by Maverick Equity Research shows Nvidia's trajectory since 2017, as the firm predicts the stock could fall as much as 30% this year. Nvidia shares (NVDA) rose 38% last year and are flat in 2026 so far. Maverick also predicts one or two 15% pullbacks for the S&P 500.

Top tickers

These were the top-searched tickers on MarketWatch as of 6 a.m.:

   Ticker  Security name 
   NVDA    Nvidia 
   INFY    Infosys 
   TSLA    Tesla 
   GME     GameStop 
   TSM     Taiwan Semiconductor Manufacturing 
   AMD     Advanced Micro Devices 
   INTC    Intel 
   AAPL    Apple 
   PLTR    Palantir 
   AMZN    Amazon 

Random reads

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A U.K. police chief is under fire after admitting a delusion from Microsoft Copilot produced incorrect evidence.

These animals are enduring the heat thanks to popsicles.

-Barbara Kollmeyer

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January 14, 2026 07:33 ET (12:33 GMT)

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