Wednesday's Financial Winners & Losers

Merrill Lynch (MER Quote) and most other financial-sector stocks traded lower Wednesday after Federal Reserve chairman Ben Bernanke called recent inflation numbers "uncomfortably high" despite a modest slowing of core rates in the latter half of 2006. Although Lehman Brothers began coverage on the broker with an overweight rating today, Merrill Lynch shares closed down $1.66, or 2%, at $82.28.

Citigroup (C Quote) got a small lift in mixed trading after a Banc of America analyst upgraded the stock to buy from neutral. The analyst said years of disappointing results from the banking giant could render any improvement an upward catalyst. After climbing 8 cents earlier in the day, the stock closed the session down 9 cents, or 0.2%, at $50.97.

According to The Wall Street Journal, Citigroup is also advising Britain's Barclay's in the latter's exclusive merger discussions with ABN Amro (ABN Quote), thus precluding the possibility that Citigroup might make a counteroffer. ABN did state, however, that it will consider other deals should the talks with Barclay's fall through. ABN's shares closed down 64 cents, or 1.5%, at $42.62. ...