After a couple of blockbuster weeks for stocks, the market is taking a long-deserved break today. Despite excitement about new quantitative easing from the Fed, the important thing to remember about government intervention is that the entire reason for it is that the economy isn't behaving the way policymakers want. Today's Empire State Index reading of -10.4 for manufacturing activity in New York was just the latest example of how slow the economy has been to react to past attempts at boosting growth. Just before 10:45 a.m. EDT, the Dow Jones Industrials (INDEX: ^DJI) were down about 27 points.
Among Dow stocks, most of the big movers were on the losing side. Cisco Systems (NASDAQ: CSCO) fell 1.75% as it agreed to sell its stake in Comviva Technologies to Indian outsourcer Tech Mahindra. But the malaise may come more from concerns about Cisco's growth. Many dividend-hungry investors have pointed to Cisco's recent 75% increase in its payout as a positive sign, but Fool analysts David Meier and John Reeves noted that higher dividends also mean that Cisco doesn't see opportunities to invest in profitable projects.
Bank of America (NYSE: BAC) was also down more than 2%, likely reflecting general concerns about the economy. In the long term, though, the bank is forced to fight against calls for it to split up, with Fool contributor Michael Lewis having noted over the weekend that investment banking divisions may be holding big banks like B of A back from realizing their full value. Pointing to Wells Fargo (NYSE: WFC) as an example of a bank with a simpler structure and a stronger focus on traditional banking, Lewis argues that bank management teams are missing a smart move by rallying to keep their companies in one piece.
Finally, Alcoa (NYSE: AA) was down almost 2%, giving back part of its 15% gain over the past two weeks. An article in Bloomberg over the weekend highlighted a tug-of-war occurring in Brazil as the government forces utilities to make electricity cheaper. Given the electricity-intensive production process for aluminum, Alcoa stands to be a huge winner if those initiatives push through.