Dow Makes a Halting Recovery Ahead of Fed Meeting

The Dow Jones Industrial Average (DJINDICES: ^DJI  )  is down more than 60 points at noon EST after suffering some nasty losses last week. After worrying about emerging markets as the previous week closed, investors are likely turning their attention to domestic issues today -- particularly the commencement of the Federal Open Market Committee meeting tomorrow, in which taper discussions will be front and center.

Economic news doesn't excite
The U.S. Census Bureau released data on new single-family home sales this morning, and it wasn't wonderful. Sales in December totaled only 414,000, down from November's adjusted rate of 445,000 and much lower than the expected 450,000. Even more of a bummer is the rise in unsold home inventory to 171,000, which now represents five months' worth of sales.

The Dallas Federal Reserve released its Texas Manufacturing Outlook Survey, which showed a slight uptick in participants' business activity outlook in January to 3.8, a rise of just 0.1 from December. Most respondents saw no real change in business conditions from the previous month.

Analysts: Expect another $10 billion in tapering
As the FOMC begins its last meeting with Ben Bernanke in the driver's seat, markets will have to wait until Wednesday to find out if the taper will continue or be put on hold. Most observers are betting on another $10 billion in bond-buying reductions for next month, noting that both December's committee minutes and recent comments from Fed officials seem to indicate a slow and steady winding down of quantitative easing.

In other economic news, President Obama is expected to deliver a forceful State of the Union address tomorrow, stressing that he will implement economic agenda measures surrounding jobs, education, and infrastructure over the objections of Congress, if necessary, to get the economy back on track.

Financials mixed
JPMorgan Chase 
(NYSE: JPM  ) was down 0.41% at noon, while Goldman Sachs sagged more than 2%. There are a few tidbits of news concerning banks, much of which centers around JPMorgan and old Dow component Bank of America (NYSE: BAC  ) .

JPMorgan CEO Jamie Dimon may be getting an even bigger pay boost than previously reported, according to Bloomberg. After voting to give Dimon a big $20 million raise this year, the bank's board is mulling whether he should be allowed to cash in 2 million stock options bestowed upon him back in 2008. 

Bank of America is under investigation for trading improprieties, as the bank's trading desk is suspected of putting its own trades in ahead of mortgage giants Fannie Mae and Freddie Mac, in order to profit from any interest rate moves the latter's trades might create. BofA had been flying high lately, hitting and holding the $17-per-share mark following third-quarter earnings. The stock is down today, however, by more than 2%.

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