Investment house Bear Stearns(BSC Quote) sent financial stocks in a downward spiral Friday after hemorrhaging more than half its value after news of a bailout involving the New York Federal Reserve Bank and JPMorgan Chase(JPM Quote).
Just two days after he tried to dispel credit rumors on CNBC, Bear CEO Alan Schwartz did an about face and said in a statement that the company's liquidity position in the last 24 hours "had significantly deteriorated." In rare move, the Fed allowed Bear access to the discount window mid-month through JPMorgan, providing the company 28 days of secured funding. The stock had collapsed 39% to $34.62, a loss of $22.53.
Bear's collapse drove down the Amex Securities Broker/Dealer Index 8.6% to $156.58 and the NYSE Financial Sector Index fell 3.8% to 6,861.08.
The bleeding continued over at Lehman Brothers(LEH Quote). Its shares slid 14% to $39.62, even after announcing it closed on a $2 billion bank facility. ...
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