Financial Winners & Losers: CIT Group

Financial stocks closed flat Tuesday, as a big rally for commercial financier CIT Group(CIT Quote) failed to ignite the sector.

CIT shares soared 29.7% to $8.83, after the company sold its residential loan business to Lone Star Funds for $1.5 billion in cash. CIT also unloaded its manufactured housing portfolio for $300 million, as it sought to shore up its balance sheet.

Lehman Brothers(LEH Quote) has been battling takeover and collapse rumors for days, but a Morgan Stanley analyst on Tuesday said the investment bank could weather the near-term conditions and should trade close to its book value. Lehman shares jumped 5.8% to $20.69 after receiving an overweight rating from the analyst.

Many other stocks in the financial sector traded down, however, as the NYSE Financial Sector Index declined 0.46 to 6,204.49.

UBS(UBS Quote) tumbled 31 cents, or 1.5%, to $20.35 after announcing a major boardroom shuffle, as it tries to recover from enormous losses as a result of the U.S. mortgage meltdown. Four of the 12 board members will step aside as the board attempts to take responsibility for strategy.

Another loser for the day was CME Group(CME Quote), which reported its volumes in June fell by 4%. Investors sold off shares in the exchange, known for its commodities trading, whose shares slid to its lowest price since 2005. Lately, the stock was down 6.2% to $359.39.

Bank of America (BAC Quote) made its deal for Countrywide Financial(CFC Quote) official, becoming the country's largest mortgage lender. The deal was originally announced on January 11 and valued at roughly $4 billion, but as the market declined and share prices dropped, it was closer to $2.5 billion. Last week, BofA said it would lay off 7,500 jobs as a result of the acquisition. BofA shares fell 6 cents to $23.81.