Friday's Financial Winners & Losers

Financial stocks leapt to finish the week substantially higher on Friday, once again propelled by comments out of the Federal Reserve.

The sector had taken a tumble yesterday following a healthful Wednesday rise, which had been inspired by Fed Vice Chairman Donald Kohn's remarks suggesting that another rate cut is forthcoming.

Today, however, Fed head honcho Ben Bernanke helped to vault financial stocks stratospherically after saying that a number of unfavorable conditions "seem likely to create some headwinds for the consumer in the months ahead." That generally reinforced the rate-cut hopes that Kohn had already sparked two days earlier.

The NYSE Financial Sector Index jumped around 182 points, or 2.1%, to 8,681.91. The KBW Bank Index climbed some 3 points, or 3.1%, to 97.17.

Also contributing to the jubilant mood was talk that government officials are nearing a plan to temporarily freeze the "teaser" interest rates of some subprime-mortgage loans, which were otherwise planned to reset at much higher fixed rates following an introductory period. This is in the hope of avoiding a feared ensuing landslide of foreclosures.

According to The Wall Street Journal, regulators are meeting with executives from Citigroup (C Quote), which added 3.1%; Countrywide (CFC Quote), which surged 16.3%; Washington Mutual (WM Quote), up 8.3%; and Wells Fargo (WFC Quote), up 6.2%; among others. The Journal cited people familiar with the negotiations.

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