Tech, banks weigh on Wall Street; Trump eases Iran oil fears

By Isla Binnie and Alun John

Jan 14 (Reuters) – Technology and bank stocks led Wall Street indexes into a second day of declines on Wednesday, while oil prices snapped back from the day’s highs after U.S. President Donald Trump softened warnings about unrest in Iran, although persistent economic and geopolitical uncertainty continued to support precious metals.

Banner earnings releases from three of the largest U.S. banks showed rising profits from lending to credit-hungry consumers and businesses and rising fees from a dealmaking rebound, although Wells Fargo missed profit expectations. 

Investors sold bank stocks, sending Bank of America shares down more than 4%, Citigroup 4.5% lower and Wells Fargo sliding more than 5%.

Bank shares had jumped 25% in the past 12 months but fell this week in part due to a proposal from Trump to cap credit card interest rates.

“After a nice run, and so-so or mediocre earnings, you’re seeing profit-taking and consolidation” in the banks, said Michael O’Rourke, chief market strategist at JonesTrading in Stamford, Connecticut. “Generally speaking, people are still optimistic on the group.”

Selling spread to tech and growth stocks as investors looked for bargains, while Broadcom and Fortinet fell after a Reuters report about new limits from Chinese authorities on domestic companies using cybersecurity software made by roughly a dozen U.S. and Israeli firms.

The tech-heavy Nasdaq Composite closed 1% lower at 23,471.75. The Dow Jones Industrial Average declined 0.09% to 49,149.63, and the S&P 500 fell 0.53% to 6,926.60.

Data showed U.S. retail sales increased more than expected and producer prices picked up slightly in November, lending further support to broad expectations that the Federal Reserve will cut interest rates twice later this year.

MAYBE NO ATTACK ON IRAN

Traders are grappling this week with questions over Federal Reserve  independence, the U.S. desire to control Greenland and its implications for the NATO alliance, and whether the U.S. would attack Iran after a crackdown on historic protests. 

Oil prices settled higher but then gave back most of the day’s gains after Trump said on Wednesday afternoon he had been told that killings in Iran’s crackdown on nationwide protests were subsiding and he believed there was currently no plan for large-scale executions. [O/R]

“The market now thinks that maybe there is not going to be an attack on Iran so the stock market rallied and oil prices plummeted really quickly,” said Phil Flynn, senior analyst with the Price Futures Group.

Trump said the U.S. would “watch what the process is” in Iran.

U.S. crude fell 1.1% to $60.49 a barrel and Brent declined 0.93% to $64.86 per barrel.

Expectations of more supply from Venezuela and news that the country’s state energy company has begun reversing oil production cuts made under a U.S. embargo limited price gains.

The dollar, meanwhile, strengthened modestly against the euro, benefiting from the prospect that the Fed will wait several months before restarting rate cuts.

The dollar index, which measures the greenback against a basket of currencies including the yen and the euro, fell 0.1% to 99.09, with the euro last up 0.01% at $1.1643.

PAVED WITH GOLD?

Much market momentum was reserved for precious metals.

Silver rose past $92 per ounce for the first time on Wednesday. It began 2025 under $30 an ounce, and has surged 29% in the first nine trading days of this year. [GOL/]

Gold touched yet another record high of $4,641.40 per ounce and was last seen up 0.73% at $4,620.60 an ounce. Copper is also at unprecedented levels. [MET/L]     

“All roads are leading to gold and silver,” said Alex Ebkarian, chief operating officer at Allegiance Gold, citing demand from diverse buyers and noting the market is in a structural bull phase.

Gold yields no interest and typically performs well when interest rates are low and uncertainty is high.

The U.S. Supreme Court took one item off the day’s agenda when it did not issue a ruling on the legality of Trump’s global tariffs. Meanwhile, U.S. high-end department store conglomerate Saks Global filed for bankruptcy protection. 

(Reporting by Isla Binnie, Alun John and Ankur Banerjee; Additional reporting by Caroline Valetkevitch; Editing by Nick Zieminski, Mark Heinrich and Jamie Freed)