Financial Winners & Losers: Freddie Mac

Troubled mortgage lender Freddie Mac (FRE Quote) delivered terrible losses for the second quarter placing a pall over the financial sector.

Freddie lost $821 million for the quarter compared to a $729 million profit for the same quarter last year. Revenue slumped to $1.69 billion from $2.34 billion. The lender also set aside $2.5 billion in reserves for expected mortgage delinquencies and foreclosures. The stock plunged 18.3% to $6.57. Fellow government-sponsored lender Fannie Mae(FNM Quote) reports results on Friday and tumbled 14.4% to $11.64.

Merrill Lynch(MER Quote) declined in early trading but then rallied in the afternoon even after analysts slammed the company with negative comments. A Deutsche Bank analyst lowered his profit forecast to $2.30 a share from $2.45 and kept his hold rating. A Bernstein analyst suggested that the company should cut its dividend in light of the additional shares the company has issued. He calculated that Merrill would be on the hook for $2.85 billion in dividends if it didn't reduce the amount. The stock was recently trading down fractionally to $28.08. Protective Life(PL Quote) shares gave back 10.2% to trade at $34.18 after the insurance and investment product provide lowered its guidance for the year and cited the difficult macroeconomic environment for cars and boats. ...