Bank of America Stock Pulls the Dow Toward Another Record
Stock markets ended last week at record levels, but without significant economic news driving stocks, they're flat today. The Dow Jones Industrial Average is down a mere five points, and the S&P 500 has gained three points near the end of trading.
The big mover is Bank of America , which jumped 4.5% after it agreed to a $1.7 billion settlement with MBIA over mortgage bonds. Under the deal, Bank of America will pay $1.7 billion in cash and IOUs, provide a $500 million credit line to MBIA, and take a 5% stake in the company. Before the deal, MBIA was in danger of going bankrupt, and this appears to be a win-win for the two parties.
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JPMorgan is lagging B of A, but it's having a good day nonetheless, up 1.4%. The company is getting a lot of attention over an upcoming stockholder vote to potentially split Jamie Dimon's dual role as CEO and chairman into two separate positions. A shareholder advisory firm wants an independent chairman and three of JPMorgan's directors to be fired after a $6.2 billion trading loss rocked the firm last year. Last week, Warren Buffett said he was in favor of letting Dimon keeping both rolls -- not a bad man to have in your corner. Shareholders decide the fate of Dimon and the directors on May 21 at an annual shareholder meeting, though I'd be surprised if there were major changes.
UnitedHealth Group is the second-biggest gainer on the Dow, climbing 2.3%. An analyst at JPMorgan upgraded the stock to overweight from neutral. Stocks often jump on analyst upgrades, but the euphoria quickly wears off, so I don't see this as a reason to buy today.
The article Bank of America Stock Pulls the Dow Toward Another Record originally appeared on Fool.com.Fool contributor Travis Hoium has no position in any stocks mentioned. The Motley Fool recommends UnitedHealth Group. The Motley Fool owns shares of Bank of America and JPMorgan Chase & Co.. 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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