Dow Wavers After Hitting New High
It might not have closed over the 15,000-point threshold, but the Dow Jones Industrial Average surpassed that mark in trading on Friday. The much-anticipated employment report delivered such good news that the market jumped for joy and the index rose mightily. But this morning, with no real economic news to bolster its gains, the Dow has already dropped and recovered -- signaling some indecision on the part of investors. As of 11:15 a.m. EDT, the index is down 0.13% in trading.
A new milestone
When the market hits a new record, it's hard to just sit back and enjoy it. And since the 15,000 mark was passed as we headed into a weekend, that gives investors a lot of time to contemplate whether the market really warranted the rise or not. So far in 2013, the Dow has gained 11.64%, while the economy has not recovered at the pace most expected. Only time will tell, but for now we may want to ask whether the rise will stop anytime soon.
Inside the Dow
Leading the small pack of component stocks in positive territory this morning is Bank of America. Though there is news that the bank will be facing another court battle with the New York Attorney General's office, its stock is up 2.21% so far in trading. The rise is in large part due to another looming court hearing over a $8.5 billion settlement pertaining to the bank's Countrywide mortgage-backed securities. Arguments are set to begin at the end of the month, with a judge ultimately ruling whether to allow or dismiss the settlement. Recently, AIG joined a group of investors petitioning the court to disallow the settlement. AIG insured a large number of mortgage-backed securities from B of A that resulted in losses for the company.
But some good news for the bank emerged late last week: The states of New York and Delaware have dropped their objections to the settlement. The attorneys general have stated that they found new evidence that made their previous positions unnecessary. If the settlement is rejected, Bank of America could be on the hook for up to $60 billion.
JPMorgan Chase is also up this morning, with a 1.03% rise so far. In two weeks, the bank will hold its annual shareholder meeting, which will be watched closely. At the meeting, investors will be able to vote on whether or not to split CEO Jamie Dimon's current dual CEO-chairman role. Many investors have been calling for more oversight of the top dog following last summer's London Whale debacle. But recently, Dimon got an endorsement from a person in high places -- Warren Buffett. Just a day after the annual Berkshire Hathaway shareholder meeting, Buffett put his full support behind Dimon, stating that he couldn't think of a better chairman and that splitting the role would make it easier to replace the CEO, which might not be the right play for the bank.
With big finance firms still trading at deep discounts to their historic norms, investors everywhere are wondering if this is the new normal, or if finance stocks are a screaming buy today. The answer depends on the company, so to help figure out whether JPMorgan is a buy today, check out The Motley Fool's premium research report on the company. Click here now for instant access!
The article Dow Wavers After Hitting New High originally appeared on Fool.com.Fool contributor Jessica Alling has no position in any stocks mentioned -- you can contact her here. The Motley Fool recommends American International Group and Berkshire Hathaway. The Motley Fool owns shares of American International Group, Bank of America, Berkshire Hathaway, and JPMorgan Chase and has the following options: Long Jan 2014 $25 Calls on American International Group. 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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