Why Bank of America's Leading a Sleepy Dow

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So much for the triple-digit gains investors welcomed last week. Markets are flat this Monday, and the Dow Jones Industrial Average (DJINDICES: ^DJI  ) is nursing the hangover of last week's stock market party. As of 2:25 p.m. EDT the Dow has gained just 12 points, or less than 0.1%, with stocks fairly evenly split between risers and fallers. Big banks have had a good day so far, but outside of the financial sector, few blue-chippers are making waves today. Let's catch up on the stories you need to know.

Financials on the upswing
Bank of America
(NYSE: BAC  ) shareholders aren't suffering a case of the Mondays today: The stock is up 4.6% to lead the Dow higher. The firm settled a legal dispute with MBIA today, with B of A reportedly set to pay $1.6 billion to the latter in order to resolve the disagreement.

All is not well, however: The New York attorney general announced plans today to sue Bank of America and Wells Fargo, alleging that the two institutions repeatedly violated a $25 billion mortgage settlement. It's another PR smudge that B of A doesn't need as it works to escape the shadow of the recession and financial crisis.

Speaking of financial firms under scrutiny, shares of JPMorgan (NYSE: JPM  ) have risen 1.4% today, even as advisory firm Institutional Shareholders Services pushed company shareholders not to back the re-election of three board members due to lack of oversight during JPMorgan's London Whale losses. ISS also pushed a proposal for CEO and chairman Jamie Dimon to give up one of his titles, citing the company's size and need for independent oversight considering London's trading losses of more than $6 billion.

Outside of financials, health care stocks are having an up-and-down day. UnitedHealth Group (NYSE: UNH  ) got a boost from JPMorgan earlier after a company analyst upgraded the stock to "Overweight," citing a low-risk membership base as compared to the industry. The move sent shares of UnitedHealth up 2.6%, making the stock the second-leading pick on the Dow today. With Obamacare set to levy an uncertain future on the health insurance industry, size matters more than ever -- and UnitedHealth's position as the largest health-insurer in America, with 42 million total medical members, entrenches it as one of the safest insurance picks for risk-averse investors.

On the other side of the Dow, fellow health care company Merck (NYSE: MRK  ) isn't having such a good day. Shares of the big pharma have fallen 1.1% to lead the Dow laggards today despite a lack of news on the company. Merck still faces questions on how it will rebuild sales lost from patent expirations on leading drugs such as Singulair. A recent earnings miss didn't help investor attitudes toward this company's future, particularly as star diabetes medication Januvia badly missed analyst sales expectations. Merck has plenty of ground to make up in the near future to overcome investor doubts, and it will need its blockbuster therapies to lead its sales growth.

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 to both buy and sell. To find out more click here to claim your copy today.

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Related Tickers

9/30/2016 2:34 PM
^DJI $18342.41 Up +198.96 +1.10%
BAC $15.67 Up +0.51 +3.33%
Bank of America CAPS Rating: ****
JPM $66.85 Up +1.20 +1.83%
JPMorgan Chase CAPS Rating: ****
MRK $62.41 Up +0.50 +0.81%
Merck and Co. CAPS Rating: ****
UNH $139.79 Up +1.47 +1.06%
UnitedHealth Group CAPS Rating: ****