by David Gaffen, wsj.com

Investors have found a lot to like in the recent market rally, but one area where they're turning up their nose is the financial-services sector, which seems to have stalled out in the last month or so while the rest of the market moves higher. This is worrisome to some analysts, as Merrill Lynch points out, because the Philadelphia Stock Exchange/KBW Bank Index was a "good leading indicator signaling a breakout in the market." Now, they say the recent performance in the banks could be an "early warning sign that the equity markets may be nearing a peak."

Bruce Zaro, chief technical strategist at Delta Global Advisors, says the decline in the Philly Bank Index is perhaps due to the pullback in interest rates, which dove in the late summer, and reduced hope that the Federal Reserve will soon cut interest rates. "There's nothing the market likes better than short-term rates falling, but the market has been expecting that move imminently, and that is a bit premature," he said.

*The excerpt above ran in the "Market Beat" column. WSJ.com subscribers can access the full article by clicking here