Thursday's Financial Winners & Losers

Updated from 1:49 p.m. EST with new stock prices

Financial stocks had another volatile day Thursday, lurching in and out of the green as the broad indices turned up mixed.

Among the solid winners, however, was State Street (STT Quote), despite announcing it will take a big charge. The Boston bank established a $618 million reserve for anticipated legal costs to defend against customers with "concerns as to whether the execution" of some battered mortgage-backed investments at State Street Global Advisors "was consistent with the customers' investment intent."

State Street also said it will let go of Global Advisors CEO William Hunt. Executive VP James Phalen will replace him in the interim as a permanent successor is sought.

After taxes, the reserve will slice $279 million, or 71 cents a share, off State Street's income. But, stripping that out, 2007 earnings should come to between $4.54 and $4.57 a share against Wall Street's $4.19 consensus, according to Thomson Financial. Shares were jumping 8.2% at $85.38.

Marsh & McLennan (MMC Quote) also climbed after Reuters reported that Dan Glaser, new CEO of the New York firm's insurance-brokerage unit, will guide it through a major restructuring, per sources close to the situation. In addition, The Wall Street Journal reported Nelson Peltz's investment vehicle Trian Partners has taken a "small" stake in the company. MMC shares were gaining 8 cents, or 0.3%, to $27.06.

On the other hand, Thomas Weisel Partners (TWPG Quote) slid 9.4% to $11.83 after saying it will see a one-off charge of some $23.2 million, or 50 cents a share, due to an early payout of 2008 mid-year bonuses. These will be tucked into 2007 year-end bonuses, and, thereafter, the asset manager plans on halting the mid-year-bonus practice. Analysts, who typically exclude one-time items, are looking for full-year earnings of 72 cents a share.