AmEx and AIG: Financial Winners & Losers

American Express dropped sharply while AIG rose on Monday
By Dan Freed ,

NEW YORK (

TheStreet

) -- Financial stocks were mostly positive Monday despite continued weakness in European markets and a sharp selloff in

American Express

(AXP) - Get Report

. The

Financial Select Sector SPDR

(XLF) - Get Report

, a popular exchange traded fund that tracks financial stocks, was up 0.39% to $15.59 in late afternoon trades.

American Express

(AXP) - Get Report

plunged 4.34% to $42.10 after a

downgrade

from Stifel Nicolaus Chris Brendler. Brendler sees a threat to American Express from a

Federal Reserve

crackdown on so-called "interchange fees," which merchants pay to credit card companies. Shares of

Visa

(V) - Get Report

and

Mastercard

(MA) - Get Report

were hit hard last week as a result of the issue, though both were up Monday.

AIG

(AIG) - Get Report

continued to post strong gains, setting a new 52-week high of $54.35, before dropping to $53.69 in mid afternoon trading--still up nearly 3% on the day. Volumes of 5.2 million with nearly 90 minutes left in the trading day compared to a trailing three month daily average of 5 million. The stock has been gaining ground lately as big name investors like Bruce Berkowitz have been piling in, and government officials have said the government will end up profiting from AIG, which it has provided with $182 billion in debt equity and credit lines, according to the

Financial Times

.

Perhaps spurred on by AIG's roughly 75% gains this year, investors appear to be getting more active in common shares of

Fannie Mae

and

Freddie Mac

. Surges in shares of these companies can often be attributed to short squeezes. Whatever the reason, shares of Fannie Mae rose five cents to $0.34, a 15.2% gain on volumes of 13 million shares with an hour left of trading versus a trailing three month daily average of just over eight million shares. Shares of Freddie Mac were up two cents or 6.15% to $0.35 on volumes of 4.4 million, compared to a 3.7 million daily average over the last three months. Freddie Mac shares hit $0.50 on Friday, their highest level since late June, but closed at $0.33.

Trading activity in shares of these companies, which owe the government tens, if not hundreds of billions of dollars, is sure to pick up in the new year as Congress debates over their future.

Big bank names were generally positive, with

Citigroup

(C) - Get Report

up 0.43% and

Bank of America

(BAC) - Get Report

up 0.53% in the last hour of trading.

--

Written by Dan Freed in New York

.

Disclosure: TheStreet's editorial policy prohibits staff editors, reporters and analysts from holding positions in any individual stocks.

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