JPMorgan's Drop Drags on the Dow: Stock Market Today

Small-cap stocks outperformed Tuesday on expectations that the Fed will cut interest rates on Wednesday. When you purchase through links on our site, we may earn an affiliate commission. Here’s how it works. Stocks were choppy Tuesday, with market participants in wait-and-see mode ahead of tomorrow's policy announcement from the Federal Reserve. With the central bank widely expected to cut interest rates again, rate-sensitive small caps outperformed and the Russell 2000 hit a new intraday high.The small-cap benchmark fell short of a new record close, though, gaining 0.2% to 2,526. The tech-heavy Nasdaq Composite (+0.1% at 23,576) also finished in positive territory, while the broader S&P 500 (-0.09% at 6,840) and the blue-chip Dow Jones Industrial Average (-0.4% at 47,560) ended in the red.The Fed will wrap up its final meeting of 2025 tomorrow afternoon. According to CME FedWatch, futures traders are currently pricing in an 87% chance the central bank will lower the federal funds rate by a quarter-percentage point to a range of 3.5% to 3.75% – the lowest it's been since September 2022.Become a smarter, better informed investor. Subscribe from just $107.88 $24.99, plus get up to 4 Special IssuesProfit and prosper with the best of expert advice on investing, taxes, retirement, personal finance and more - straight to your e-mail.Profit and prosper with the best of expert advice - straight to your e-mail.But just "beneath this near certainty lies an unusual public split within the Federal Open Market Committee," says Larry Adam, chief investment officer at Raymond James. "Recent dissents highlight the challenge of balancing a cooling job market against stubborn inflation – casting fresh uncertainty over the policy path for 2026."And the end of Jerome Powell's term as Fed chair in May adds intrigue to the rate-cut debate.

National Economic Council director Kevin Hassett, who is the frontrunner to replace Powell, said during a Wall Street Journal CEO Council event on Tuesday that "there's plenty of room" to cut rates moving forward, "if the data suggests we could do it."For now, Wall Street will have to rely on the FOMC's Summary of Economic Projections, or "dot plot", to see where committee members expect the federal funds rate to be at the end of 2026.In September, the dot plot revealed median expectations for just one quarter-point rate cut in 2026, following three in 2025. "We don't anticipate major changes to that median view, but the growing gap between market pricing and the Fed's expected rate path is a risk worth watching," says Adam.The Federal Reserve received its last labor market update ahead of tomorrow's policy decision with this morning's release of the Job Openings and Labor Turnover Survey (JOLTS).According to the Bureau of Labor Statistics, there were 7.67 million job openings in October, a tick higher than the 7.658 million job openings in September.Total separations, which include quits, layoffs and discharges, slipped to 5.05 million from 5.264 million, as did hires (to 5.149 million from 5.367 million)."The labor market is holding on, though it remains fairly unfriendly to job seekers," says Elizabeth Renter, senior economist at NerdWallet. "When employers aren't hiring, it makes it difficult for those without work, but also those who could otherwise move on from their current jobs to better opportunities."The stagnation in both hiring and quits isn't great for the economy, she says, "but it's not bad enough to cause alarm. A more dramatic pullback in hiring could push the unemployment rate up, as could significant layoffs, but we're not seeing either of those in the data, yet."In single-stock news, Nvidia (NVDA) erased a pre-market lead to end the day down 0.3% even after President Donald Trump on Monday said the tech giant can sell its H200 artificial intelligence chips to China.The chips would be available to "approved customers," wrote Trump in a Truth Social post, and the U.S. will receive 25% of the sales. "President Xi responded positively" to the news, Trump added.But the H200 chips are two generations behind Nvidia's B300 chips, says William Blair analyst Sebastien Naji, and "it remains unclear whether there will be actual orders for these older GPUs."Naji points out that the reversal of the H20 chips in August did not create any new sales. Additionally, China has increased its focus on domestically produced chips from companies such as Huawei and Cambricon.Still, the analyst does expect sales of the H200 chips, which are more powerful than H20s, to materialize and drive upside to fiscal 2027 revenue estimates.NVDA was one of 19 Dow Jones stocks that closed in the red on Tuesday, but the worst of the bunch was JPMorgan Chase (JPM), which slid 4.7% after increasing its 2026 expense forecast.The country's biggest bank by assets under management said it expects to spend $105 billion next year, up from an estimated $95.9 billion in spending this year and analysts' forecast for $101 billion.Marianne Lake, CEO of JPM's Consumer & Community Banking segment, said the spending will cover compensation and product marketing costs, as well as strategic investments such as AI.Profit and prosper with the best of Kiplinger's advice on investing, taxes, retirement, personal finance and much more. Delivered daily. Enter your email in the box and click Sign Me Up.With over a decade of experience writing about the stock market, Karee Venema is the senior investing editor at Kiplinger.com. She joined the publication in April 2021 after 10 years of working as an investing writer and columnist at a local investment research firm. In her previous role, Karee focused primarily on options trading, as well as technical, fundamental and sentiment analysis. Fear of losing money could actually cost you in retirement. Find out why being too conservative with your life savings can hurt you and how to stop that from happening.

Tax Refunds Here's how the IRS tax refund outlook for 2026 is changing and what steps you can take now to prepare. Before you settle into that cushy lounge chair, skip the rookie moves that annoy other travelers and can even get you kicked out. This teen swiped a booby-trapped package that showered him with glitter, and then he hurt his wrist while fleeing. This is why no lawyer will represent him. As a financial professional, you can strengthen your brand while making a difference in your community. See how these pros turned community spirit into growth. Advisers who leverage innovative technology to streamline tasks and combat a talent shortage can then prioritize the irreplaceable human touch and empathy. The family office model is no longer just for the ultra-wealthy. Advisory firms will need to ensure they have the talent and the tech to serve their clients. While a rate cut is widely expected this week, uncertainty is building around the Fed's future plans for monetary policy.

The December Fed meeting is one of the last key economic events of 2025, with Wall Street closely watching what Chair Powell & Co. will do about interest rates. Investors should treat bitcoin as the high-risk asset it is. A look at the data indicates a small portfolio allocation for most investors would be the safest. Many federal employees ask about rolling a TSP into an IRA and parsing options for survivor benefits, both especially critical topics.