January 13 Earnings Day: Key Catalysts and Tactical Setups

The opening bell for the 2026 earnings season rings with a trio of major financial reports. JPMorgan Chase kicks things off before the market opens, setting the tone for the week. The consensus EPS estimate is $5.01, a 4.16% year-over-year increase. The key watchpoint is the guidance; investors will want to hear how much of 2025's strong momentum is expected to carry into 2026, especially given signs of a weakening labor market and ongoing regulatory scrutiny. This is a high-stakes call, as JPM has beaten expectations every quarter over the past year.

Following JPM, Bank of New York Mellon reports with a consensus EPS of $1.97, up 14.53% from last year. The market will be looking for confirmation that its strong beat history continues, particularly in its wealth management and custody businesses. The stock trades at a P/E ratio of 16.09, below the industry average, which could be a catalyst if the report shows growth accelerating faster than peers.

The third major report comes from Delta Air Lines. The airline is expected to post a consensus EPS of $1.53, a 17.30% decline from the same quarter last year. This sets up a clear test: can Delta's operational execution and load factors offset the seasonal headwinds and any lingering cost pressures? The stock's P/E ratio of 12.42 is also below the industry, making a positive surprise here a potential catalyst for a re-rating.

Expectations and Market Context

The market is braced for a mix of strong beats and potential disappointments as the major reports hit. For JPMorgan, the consensus EPS estimate sits at $4.92, a figure that has already been met by the bank's own guidance. The real test is whether management can maintain its streak of quarterly beats while navigating a softening labor market. The stock's recent performance has been steady, but the setup hinges entirely on forward-looking guidance.

Bank of New York Mellon enters with a more optimistic baseline. The consensus EPS of $1.98 implies a 14.5% year-over-year jump, a pace the bank has already shown it can exceed. BNY boasts an impressive earnings surprise history, with an average beat of 9.1% over the last four quarters. This creates a clear expectation for another upside move, especially if fee revenues and net interest income continue to outperform.

Delta Air Lines presents the steepest challenge. The consensus EPS of $1.53 marks a 17.3% decline from the same quarter last year. The stock's recent underperformance reflects this weak trajectory, but the setup is binary. A beat would signal operational resilience, while a miss on key metrics like PRASM or guidance for early 2026 could trigger a sharp re-rating. The market is pricing in a difficult quarter, leaving room for a surprise in either direction.

Immediate Risk/Reward Setups

The tactical trade for each major report hinges on a single, decisive metric that will either confirm or contradict the market's current view. For JPMorgan, that metric is net interest income, expected to hit $24.99 billion. This is the bedrock of the bank's earnings, and a miss here would directly undermine the Goldilocks narrative that has powered the KBW Bank Index's 29% rally last year. The risk is that management's guidance reveals cracks in consumer spend or loan growth, turning a strong quarter into a warning sign for 2026. The reward is a beat that validates the bank's economic barometer status and could spark a sector-wide re-rating.

For Bank of New York Mellon, the setup is binary around its fee revenues and net interest income. The stock trades at a discount to peers, so a beat on both fronts would be the catalyst for a re-rating. The risk is that higher expenses or a lower assets under management balance, as noted in the prior quarter, continue to pressure margins. The reward is a repeat of its 9.1% average earnings beat, which has become the baseline expectation. A clean beat here would signal operational strength in wealth management and custody, justifying its current valuation.

Delta Air Lines presents the clearest binary outcome. The critical metric is PRASM, or passenger revenue per seat mile. The company's Q3 guidance called for 2-4% growth into this quarter. Meeting or exceeding that target would be a bullish signal of demand resilience, potentially offsetting the weak EPS consensus. The risk is a miss, which would confirm that cost pressures are overwhelming revenue growth. The reward is a beat that could trigger a sharp re-rating, especially if management also provides positive early 2026 guidance on domestic and transatlantic demand.

Event-Driven Trading Implications

The tactical setup for each report is clear. For JPMorgan, the key watchpoint is net interest income. A beat here would validate the bank's role as an economic barometer, but a miss would directly undermine the sector's Goldilocks narrative and likely trigger a broader bank sell-off. The stock's recent performance has been steady, but the guidance will set the tone for the entire financial sector.

For Bank of New York Mellon, the watchpoint is whether its 9.1% average earnings beat continues. The stock trades at a discount to peers, so a clean beat on fee revenues and net interest income is the catalyst for a re-rating. The risk is that higher expenses or a lower assets under management balance pressure margins, capping any upside.

Delta Air Lines presents the clearest binary outcome. The critical metric is PRASM. Meeting or exceeding the Q3 guidance of 2-4% growth would signal demand resilience and could trigger a sharp re-rating. A miss, however, would confirm that cost pressures are overwhelming revenue growth, likely leading to a sell-off. The market is pricing in a weak quarter, leaving room for a surprise in either direction.