Financial Winners & Losers: Wachovia
06/30/08 - 05:44 PM EDT
Debra Borchardt
Lehman Brothers (LEH Quote - Cramer on LEH - Stock Picks) plunged 11% to $19.81 on a rumor that Barclays(BCS Quote - Cramer on BCS - Stock Picks) would buy it at a discount. Lehman declined to comment to the Associated Press.
Ambac Financial (ABK Quote - Cramer on ABK - Stock Picks) shares gave back 16.8% after the bond insurer was removed from the Russell 1000 index of large-cap stocks and added to the Russell 2000 small-cap index. Many mutual funds and institutional investors that track the indices would be forced to rebalance causing the selloff in shares. Ambac was selling at $1.34, a loss of 27 cents. Other insurers like PMI Group (PMI Quote - Cramer on PMI - Stock Picks) suffered the same fate. PMI plummeted 17% to $1.95. The CME Group(CME Quote - Cramer on CME - Stock Picks) was down 1.6% after announcing that it extended its exclusive rights to offer futures and options on futures contracts based on Nasdaq OMX Group(NDAQ Quote - Cramer on NDAQ - Stock Picks) indices through 2019. CME will also list its common stock on the Nasdaq exchange. CME shares lost 1.6% to $383.19. The NYSE Financial Sector Index declined 97.96 to 6,204.95. Bond insurer MBIA(MBI Quote - Cramer on MBI - Stock Picks) gained 5.3% to a new low of $4.39 after saying that it had sold $4 billion in assets in the second quarter as it sought to reassure investors. The company said it now had enough cash and collateral to meet requirements triggered by recent downgrades by the ratings agencies and would record a loss of $300 million in the second quarter. There were some winners in the financial stocks on Monday. E*Trade(ETFC Quote - Cramer on ETFC - Stock Picks) ticked up 1.3% to $3.14 after saying it had reduced its debt by $95.8 million during the second quarter. The reduction was completed through a series of debt-for-equity exchanges. The retail brokerage is attempting to lower its leverage ratio and debt service requirements.
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