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After 10 straight days of gains, the Dow Jones Industrial Average (DJINDICES: ^DJI  ) finally gave back ground today, falling 25 point,s or 0.2%. The blue chips never broke into positive territory, because a poor consumer sentiment report, and a higher-than expected Consumer Price Index dampened the optimism that's fueled this month's rally.

Consumer prices jumped 0.7% in February, in large part due to a 9% increase in gas prices during the month. Overall, it was the biggest increase in consumer prices in over three years. The core CPI, which excludes food and energy, rose just 0.2%.

Meanwhile, consumer confidence dropped to 71.8, from 77.6 last month, a figure economists thought would hold, according to a University of Michigan survey. The current mark is the lowest level since December 2011, as worries about sequestration and the layoffs that may result appear to have disquieted the average consumer. The survey reported a record percentage of unfavorable responses to government fiscal policies, and consumer expectation of conditions over the next few months dropped sharply.

As for individual stocks, banks were big movers today after the Fed released its decision on which of the 18 too-big-to-fail banks could return capital to shareholders. The Fed approved the plans of 14 of the lenders, asked JPMorgan Chase (NYSE: JPM  ) and Goldman Sachs for resubmission, and outright rejected the plans of BB&T and Ally Financial. JPMorgan shares dropped 1.9% as a result, and the bank cut its share buyback plan in half, to $6 billion. It also raised its quarterly dividend from $0.30, to $0.38. Separately, in Senate hearings today, JPMorgan's former Chief Investment Officer Ina Drew, who was in charge of the unit that lost $6.2 billion in the "London Whale" trade, denied wrongdoing as the bank continues to defend itself.

Bank of America (NYSE: BAC  ) shares shot up 3.8% today after the Fed approved its plan to buy back $5 billion worth of common stock and $5.5 billion in preferred shares. B of A did not submit plans to increase its dividend, which sits at just $0.01 per quarter. Still, the approval was a big step for the lender as it's struggled to return to solvency following the financial crisis.

Boeing (NYSE: BA  ) was also a big winner today, climbing 2.1% to a new five-year high after it said the 787 should be back in flight in just a few weeks, thanks to a fortified power pack that would negate the fire risk.

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  • Report this Comment On March 15, 2013, at 10:57 PM, prginww wrote:

    I love the fact that CPI doesn't include the two biggest staples for individuals - food and energy. Does anyone else see the aburdity of Govt Stats? Unemployment number going down as jobless goes up - because they no longer count people who "give up" looking? Uncle Milton said it best - "inflation is taxation without representation". And we have all kinds of new hidden Obamacare taxes, payroll taxes, state some point, you think tht even the most brainwashed lefty has gotta want to see a change - especially when they finally start realizing just how insecure the job market is, how much they are taxed, and how much real inflation is going on.

  • Report this Comment On March 16, 2013, at 5:38 AM, prginww wrote:

    Food and fuel too "volatile" so they're excluded? Does that mean that I can exclude them or don't have to pay at the checkout counter or gas station? If I'm a bank Bernankie said the banks don't have to include foreclosed homes and derivative losses in the balance sheet, so why not? I can go to jail on a felony charge if the theft is more than $50, but the Fed can print its brains out at the rate of one TRILLION dollars a year to put a thumb on the roulette wheel of bond interest rates, see how that works? No? Me neither, but it's why I lock doors at night and believe in the second Amendment.

    Some of those 7.7% (or is it 7.9% "corrected" next month) unemployed, or the additional 14.4% employed at Walmart and Micky D's with doctorate degrees--might come looking for me.

    I wont be able to wish them away like the government does food and fuel.

    But I bet you they are plenty "volatile".

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