NEW YORK (TheStreet) -- Morgan Stanley (MS) - Get Report was the loser among major U.S. banks on Tuesday, with shares sliding 2.6% to close at $31.59.

The broad indices all ended with gains, as several economic releases indicated the U.S. housing market recovery was continuing, although the improvements were coming at a slower pace.

The Census Bureau on Tuesday said sales of new single-family homes in the United States declined 3.3% from January to a seasonally adjusted annual pace of 440,000 in February. Economists polled by Thomson Reuters on average had estimated the February sales pace would be 446,000 units. The pace of sales in February was down 1.1% from a year earlier.

The Case-Shiller 20-city home price index for January showed a very slight decline from January but was up 12.2% from a year earlier, following a year-over-year rise of 13.4% in December.

The Federal Housing Finance Agency -- the regulator of government sponsored mortgage entities Fannie Mae and Freddie Mac -- said its House Price Index rose 0.5% in January on a seasonally adjusted basis, and that the index had risen during 23 of the last 24 months. The only month for which the index declined over that period was November 2013.

Also on Tuesday, the Conference Board said its Consumer Confidence Index rose to 82.3 in March from 78.3 in February The March reading was the highest for the index since January 2008.

In his firm's economic notes on Tuesday, Deutsche Bank chief U.S. economist Joseph LaVorgna wrote that rising equity values had contributed to a significant strengthening of household finances in the U.S., with "only a small increase in household indebtedness."

The KBW Bank Index (I:BKX) was up slightly to 72.66, with winners and losers roughly split. The winner among large-cap U.S. banks on Tuesday was BB&T (BBT) - Get Report of Winston-Salem N.C., with shares rising 1.5% to close at $40.77.  BB&T was the only bank subject to Comprehensive Capital Analysis and Review, or CCAR, to have its initial capital plan rejected last year, which the Federal Reserve said was based on "qualitative" factors.  The bank's revised 2013 plan was approved by the regulator in August, but included no dividend increase of share buybacks.

Looking to Wednesday for Capital Plans

The Federal Reserve completed the first part of its two-part annual stress-test process for the nation's largest banks last Thursday when it announced that 29 out of 30 tested banks "passed" the Dodd-Frank Act Stress Tests (DFAST) by showing they could remain well capitalized with minimum Tier 1 common equity ratios of at least 5% through a "severely adverse" economic scenario.

But investors are much more interested in the second part of the stress tests, the CCAR, which incorporates banks plans to deploy excess capital through dividend increases, share buybacks and/or acquisitions into the same severely adverse scenario. The Fed will announce the results of CCAR Wednesday at 4 p.m. ET.

Bank-stock investors will have a busy time following the Fed's announcement Wednesday, when most of the banks going through CCAR will be expected to announce their plans to return capital through the first quarter of 2015.

The only bank subject to CCAR that "jumped the gun" by already announcing its capital return plans is Discover Financial Services (DFS) - Get Report, which said last Thursday it had sought Federal Reserve approval to raise its quarterly dividend to 24 cents a share from 20 cents and to buy back up to $1.6 billion in common shares from the second quarter of 2014 through the first quarter of 2015.

Discover passed the first round of stress tests with a very strong minimum Tier 1 common equity ratio of 13.2% and seems very likely to have its capital plan approved by the Fed. Discover is one of only two banks subject to CCAR to lower its share count by over 5% through net share buybacks in 2012 and in 2013. The other is State Street (STT) - Get Report of Boston.

Discover's shares were down 0.7% to $57.43, while State Street's shares were down a nickel to close at $70.16.

Morgan Stanley came through the first round of stress tests with a minimum Tier 1 common equity ratio of 6.1%, which was the third lowest among the 30 banks tested. Zions Bancorporation (ZION) - Get Report failed the first round of tests, with a minimum Tier 1 common equity ratio of just 3.6%. Bank of America had the lowest minimum Tier 1 common equity ratio of any bank that passed the first stress tests, at 5.9%.

KBW analyst Brian Kleinhanzl estimates Morgan Stanley will be approved for up to $3.772 billion in common-share buybacks from the second quarter of 2014 through the first quarter of 2015, with net repurchases for that period coming to $2.508 billion, after factoring in stock issuance for employee awards. Kleinhanzl also estimates Morgan Stanley will raise its quarterly dividend to 7 cents a share from 5 cents.

Discover Looks Even Better Following Stress Test

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Philip W. van Doorn is a member of TheStreet's banking and finance team, commenting on industry and regulatory trends. He previously served as the senior analyst for Ratings, responsible for assigning financial strength ratings to banks and savings and loan institutions. Mr. van Doorn previously served as a loan operations officer at Riverside National Bank in Fort Pierce, Fla., and as a credit analyst at the Federal Home Loan Bank of New York, where he monitored banks in New York, New Jersey and Puerto Rico. Mr. van Doorn has additional experience in the mutual fund and computer software industries. He holds a bachelor of science in business administration from Long Island University.