This Day On The Street
Continue to site
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

MBIA, Bank of America Settlement Brings Life to Quiet Market

NEW YORK ( TheStreet) -- MBIA (MBI) settled a five-year bout with Bank of America (BAC) that overshadowed a quiet day of market action on Monday.

The S&P 500 added 0.19% to 1,617.50 after the index surged past 1,600 for the first time Friday as job growth in April eased concern that the world's largest economy was unable to translate corporate profits into lower unemployment.

"We continue to find it encouraging that after some disappointing news in April, including March's employment report, the market only hesitated for a few deep breaths and is up 3%, again, exhibiting the resilience which has characterized this market," Laszlo Birinyi, founder of Connecticut-based research firm Birinyi Associates and the firm's director of research, Jeffrey Yale Rubin, wrote in a note.

Shares of MBIA popped 45.4% to $14.29 after the company announced, along with Bank of America, that the two parties had reached a settlement that would pay MBIA about $1.6 billion in cash. Bank of America was jumping 5.2% to $12.88 a share.

"As part of the settlement, Bank of America will pay MBIA approximately $1.6 billion in cash and remit to MBIA all of the outstanding MBIA 5.7% Senior Notes due 2034 that Bank of America acquired through a tender offer in December 2012," Bank of America said in a statement.

The top gaining stock on the S&P was Cliffs Natural Resources (CLF - Get Report), which climbed 5.5% to $21.01 after FBR Capital analyst Mitesh Thakkar raised his view on the mining stock to outperform from market perform with a price target of $28 after meetings with management left him more confident about Cliffs' ability to endure soft iron ore prices.

Humana (HUM - Get Report) was another big gainer, up 2.1% to $75.49, while UnitedHealth (UNH - Get Report) rose 2.2% to $60.20. JPMorgan Chase analyst Justin Lake boosted Humana to "overweight" from "neutral" and raised his price target on the stock to $91, as well as reinstated coverage of UnitedHealth with an "overweight" recommendation and $70 price target.

The Dow Jones Industrial Average dipped 0.03% to 14,968.89 while the Nasdaq rose 0.42% to 3,392.97.

Tyson Foods (TSN - Get Report) stumbled 3.3% to $24.10 after the meat processing company posted a sharp decline in earnings in the second quarter, hit by consumers replacing beef with chicken products as they tightened spending.

The U.S. economic calendar is empty Monday in a week relatively quiet on economic releases.

Meanwhile, investors will be watching Wednesday to Friday with interest as a number of Fed officials will be speaking, including Jeremy Stein, Jeffrey Lacker and Esther George.

Written by Andrea Tse and Joe Deaux in New York

>To contact the writer of this article, click here: Andrea Tse.

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Real Money

More than 30 investing pros with skin in the game give you actionable insight and investment ideas.

Product Features:
  • Access to Jim Cramer's daily blog
  • Intraday commentary and news
  • Real-time trading forums
Only $49.95
14-Days Free
14-Days Free
CLF $2.35 4.91%
HUM $173.55 2.90%
TSN $50.65 1.30%
UNH $116.26 3.15%
AAPL $117.34 -0.81%


Chart of I:DJI
DOW 17,888.35 +168.43 0.95%
S&P 500 2,102.63 +22.22 1.07%
NASDAQ 5,156.3060 +47.64 0.93%

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs