* CPI posts largest jump in almost 4 years
* JPMorgan drops on Senate report, Fed findings
* Indexes off: Dow 0.39 pct, S&P 0.39 pct, Nasdaq 0.33 pct
By Chuck Mikolajczak
NEW YORK, March 15 U.S. stocks dipped on Friday,
weighed by a decline in JPMorgan Chase after a one-two punch of
bad news for the bank, as investors digested a flurry of
The Federal Reserve told Goldman Sachs Group Inc and
JPMorgan Chase & Co that they must fix flaws in how they
determine capital payouts to shareholders, though it still
approved their plans for share buybacks and dividends.
A Senate report also alleged JPMorgan had ignored risks,
misled investors, fought with regulators and tried to work
around rules as it dealt with mushrooming losses in a
derivatives portfolio. The barrage of bad news for JPMorgan,
long seen as the safest and best-managed U.S. bank, could taint
its reputation and that of Chief Executive Jamie Dimon.
JPMorgan shares slumped 3.2 percent to $49.37 as the
biggest drag on both the Dow and S&P 500. Rival Bank of America
rose 3.1 percent to $12.49. Goldman shares
slipped 0.9 percent to $152.70. The S&P financial sector
shed 0.3 percent.
Data showed consumer prices rose 0.7 percent in February,
the largest increase in nearly four years due mostly to higher
gasoline prices, though the climb wasn't enough to garner much
attention from the Federal Reserve.
In addition, New York Federal Reserve data showed the
manufacturing sector expanded for a second straight month in
March, although the 9.24 reading was down from 10.04 in February
and expectations for a reading of 10.
Despite the market's declines, the S&P 500 remained within
striking distance of its all-time closing high of 1,565.15.
Improving economic signs and expectations that the Federal
Reserve will continue its easy monetary policy have helped boost
the Dow by 10.5 percent and the S&P by more than 9 percent this
year so far, with no major pullbacks.
"If we do get a little bit of a retracement it's just a dip
and all these dips are being met by investors looking to buy any
kind of reversal they can get near," said Gordon Charlop,
managing director at Rosenblatt Securities in New York.
The Dow Jones industrial average dropped 56.98
points, or 0.39 percent, to 14,482.16. The Standard & Poor's 500
Index lost 6.07 points, or 0.39 percent, to 1,557.16. The
Nasdaq Composite Index fell 10.75 points, or 0.33
percent, to 3,248.18.
Market volatility may be heightened at the open and near the
close due to 'quadruple witching' - the quarterly settlement and
expiration of four different types of March equity futures and
options contracts. Expiration can lead to greater volume and
volatility as players adjust or exercise derivative positions.
Data from Thomson Reuters' Lipper service showed investors
in U.S.-based funds poured $11.26 billion of new cash into stock
funds in the latest week, the most since late January.
Ulta Salon slumped 14 percent to $76 after the
beauty products retailer forecast first-quarter profit below
Wall Street estimates, despite strong results.
Also on Friday, the Federal Reserve said industrial
production grew 0.7 percent last month, more than the expected
0.4 percent, as manufacturing rebounded, indicating the economy
continues to slowly gain steam.
The Thomson Reuters/University of Michigan's preliminary
reading on the overall index on consumer sentiment dropped to
71.8 from 77.6 in February and below the 78 estimate, on
dissatisfaction with government economic policies.