Merck the Sole Standout on a Flatlining Dow

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The Dow Jones Industrial Average is trading within a tight range today, and as of noon it sits less than four points above breakeven. If the index can maintain the positive momentum through the trading session, it will be on a nine-session winning streak, breaking yet another record set two years ago.

With the federal budget due this afternoon, that new record may be facing a large headwind. But many view the Dow's journey north as unrealistic for our economic condition, so the budget may not affect investors' enthusiasm the way it normally would.

With Dow components split between winners and losers, it's anybody's guess where the Dow will end the trading session.


Losers dragging the index down
Bank of America
is the biggest loser so far today, down 1.3%. The bank has been reaping the benefits of its stress test results, but investors will be more interested in what the Fed has to announce this Thursday. In the second set of results -- the banks' ability to manage dividend increases and share buybacks -- many investors are anxious to see whether BAC will finally be permitted to raise its penny-per-share dividend. While Bank of America passed the first round, it has not received the full force of consumer confidence, as its compatriot Citigroup has. Citi was up 3% after the first round of results was announced, while B of A only got a 0.3% boost. We'll see how both these banks fare at the end of the week.

General Electric is down for a second day, having lost about 0.9% at midday. The company is facing criticism from various angles and was recently downgraded by Wall Street analysts. From 2011 to 2012, CEO Jeff Immelt's pay was increased by 80%. Though the company just inked a deal with Health Trust to provide new health-care equipment, the massive raise in Immelt's pay is raising eyebrows. GE is also looking at a potential expansion of its multiyear cleanup of contaminants in the Hudson River. It's no wonder, with all of this news, that GE has become one of the most shorted stocks on the market.

Pulling the index up
Merck is up more than 3% so far today. Following news that it can continue its clinical trials of the cholesterol drug Vytorin, Merck has gotten a solid boost. Sales of the drug had been declining over concerns about safety issues, so investors took the news as a sign that, so far, things are looking up for the drug and its producer. Though the best result would have been for the study to conclude due to a lack safety issues, this does bring the drug closer to market, where it can be used to treat heart-related problems like heart attacks, strokes, and other deadly conditions.

Can Merck beat the patent cliff?
This titan of the pharmaceutical industry stumbled into 2013 and continues to battle patent expirations and pipeline problems. Is Merck still a solid dividend play, or should investors be looking elsewhere? In a new premium research report on Merck, The Fool tackles all of the company's moving parts, its major market opportunities, and reasons both to buy and to sell. To find out more, click here to claim your copy today.


The article Merck the Sole Standout on a Flatlining Dow originally appeared on Fool.com.

Fool contributor Jessica Alling has no position in any stocks mentioned, but you can contact her here. The Motley Fool owns shares of Bank of America, Citigroup Inc, and General Electric Company. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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