Late Downdraft Dents Wall Street's Gains

On the equities side, Freddie Mac said its first-quarter loss narrowed to $151 million, or 66 cents a share, from a $3.97 loss in the fourth quarter -- far better than the average projection of 93 cents a share. Still, the loss was also nearly double that of last year, and the company plans to raise $5.5 billion "in the near future."

The stock ramped up 9.2%. Fellow government-sponsored mortgage buyer Fannie Mae (FNM Quote) was ahead by 6.3%.

Elsewhere in the financial space, Bloomberg reported that JPMorgan Chase (JPM Quote) could fire 4,000 of its own workers as the brokerage combines its operations with Bear Stearns (BSC Quote) and deals with the tough investment-banking environment, according to a person familiar with the matter.

Roughly 2,000 employees would be replaced by Bear-derived newcomers, said the report. JPMorgan shares were up 1%.

Department-store chain Macy's (M Quote), meanwhile, posted a surprise adjusted profit of 2 cents a share and reiterated its bullish full-year earnings forecast. When counting in substantial one-time restructuring and litigation charges, the company swung to a quarterly loss, but the stock still moved up 3.6%.

Elsewhere, chipmaking-equipment seller Applied Materials (AMAT Quote) said earnings dwindled by 26% last quarter, though the company beat on both top and bottom lines. Also, in a conference call, CEO Mike Splinter predicted more softness in chip-related spending while also offering his prediction that "this is the bottom." Shares spent most of the day in negative territory, but managed to finish marginally higher at $19.90.

Electronic Arts (ERTS Quote), a video-game publisher, offered a weaker full-year profit outlook than what was targeted by Wall Street. The company also came in well ahead of expectations for the fiscal fourth quarter with adjusted earnings of $30 million, or 9 cents a share, on 50% higher sales. Still, shares shed 3.7%.