Dow Live Report

JPMorgan (JPM.N) fell 2.3 percent to $43.89 and Bank of America (BAC.N) slipped 2.1 percent to $18.05. The KBW bank index .BKX dropped 3.1 percent.

“Most of the big banks’ profits come from trading and if you restrict their trading profits, that’s going to restrict their overall profits,” said Keith Springer, president of Capital Financial Advisory Services in Sacramento, California.

“The regional banks will be hurt the most because they can’t make up the cost of the fees the financial reform is going to charge them.”

But Caterpillar Inc (CAT.N) shares rose after the heavy machinery maker raised its full-year profit forecast and said “economic conditions are definitely improving.” The stock gained 4.2 percent to $71.65, keeping the Dow industrials afloat in positive territory.

The Dow Jones industrial average .DJI edged up 0.75 point, or 0.01 percent, to close at 11,205.03. The Standard & Poor’s 500 Index .SPX dropped 5.23 points, or 0.43 percent, to 1,212.05. The Nasdaq Composite Index .IXIC lost 7.20 points, or 0.28 percent, to 2,522.95.

On the New York Stock Exchange, nearly eight shares fell for every seven that rose, while on the Nasdaq, decliners beat advancers by a ratio of about 14 to 13.

Shares of health insurer Humana Inc (HUM.N) fell 4.3 percent to $43.56 over the fallout from the recently passed health reform law and on profit-taking after the company posted a strong earnings report.

The Morgan Stanley healthcare payor index .HMO tumbled 2.7 percent and all its components were negative.

Citigroup Inc (C.N) fell 5.1 percent to $4.61 after the U.S. Treasury said it would begin selling part of the 27 percent stake it holds in the bank after $45 billion in taxpayer-funded bailouts.