Stocks Open Week With Rally

Back on the corporate side, MBIA (MBI Quote) lost $2.41 billion in the first quarter as MBIA took a $3.6 billion hit in unrealized losses on insured derivatives. Still, the stock took back the bulk of its heavy Friday losses, when insurance giant AIG (AIG Quote) reported a big shortfall of its own. MBIA shares were tacking on 4.7%.

"You saw it with AIG," said Mendelsohn. "We had some negative news, and we did some damage, but we didn't really knock the daylights out of financials."

Of MBIA, he added, "She's up, but that's still an ugly-looking chart."

Mortgage insurers PMI (PMI Quote) also swung to a quarterly loss, and Radian (RDN Quote) did the same when excluding unrealized gains on derivatives and hybrid securities. Keeping in those gains, said Radian, the company booked a profit of $195.6 million. PMI was lately up 2.3%, and Radian shares rose 3%.

Also swinging to a first-quarter loss was mortgage lender IndyMac (IMB Quote). The firm, which lost $184.2 million, or $2.27 a share, warned that it won't achieve a profit until the plunge in housing prices eases up. Shares were plunging 10.5%.

HSBC (HBC Quote) was up 2.9%, however, after saying first-quarter earnings climbed from last year, thanks to its success in emerging markets such as Asia. That came even as the Britain-based bank wrote down $2.6 billion in assets and doubled its loan-impairment charges.

Away from financials, Sprint Nextel (S Quote) saw choppy trading after sharply widening its first-quarter loss to $505 million, or 18 cents a share, as it continued to lose subscribers. Stripping out one-time expenses, Sprint made 4 cents a share, or 2 cents better than expected, even as revenue fell short. Shares were lately down 2.4%.