JPMorgan Chase & Co. (NYSE:JPM) is finally on the rise after three days of losses, up 1.18% so far in trading. The recent revelations that the bank and its executives hid the true losses sustained from last year’s London Whale debacle have shaken investors who held the bank in the highest regard. As one of the only banks to escape the financial crisis largely unscathed, JPM has only now been shown to have weaknesses. The Fed’s recent stress test results cited weakness in the bank’s capital plan and required a new plan be submitted by the fourth quarter. Though this information is usually confidential, it’s been revealed that the Office of the Comptroller of the Currency downgraded the bank in its measurement of management and board last summer following the Whale incident — signaling that oversight required improvement. There’s no real sign as to why the bank is rallying so far today, but investors should be vigilant as the SEC may soon announce that it will be filing charges against the bank for its cover-up of the London trading losses.
Bank of America Corp. (NYSE:BAC), on the other hand, had been up for the first three days of the week only to lose some ground yesterday. The bank is hovering around breakeven so far in trading after dropping sharply earlier this morning. B of A and many of its compatriots have been named in a suit brought on by Freddie Mac regarding the LIBOR rigging scandal. The suit is against 15 international banks and the damages could add up to $3 billion. This is just the latest in the string of lawsuits Bank of America Corp. (NYSE:BAC) has had to fight since the financial crisis — creating more uncertainty about the bank’s future and erasing many of the gains the bank has made since passing the Fed’s stress tests with flying colors.
The article Dow: The Force Is Strong With This One originally appeared on Fool.com.
Fool contributor Jessica Alling has no position in any stocks mentioned, but you can contact her here. The Motley Fool recommends Walt Disney (NYSE:DIS). The Motley Fool owns shares of Bank of America, JPMorgan Chase & Co (NYSE:JPM)., and Walt Disney.
Copyright © 1995 – 2013 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.