Countrywide Financial's

( CFC) dramatic fall crushed loads of financial stocks Thursday even as a number of names managed to climb on positive news.

Countrywide stock, which plummeted Weenesday on a

Merrill Lynch downgrade to sell

, took another beating on

bankruptcy fears

as the Calabasas, Calif., lender drew down its $11.5 billion credit line. Moody's and Fitch

cut Countrywide's rating

in response. Shares were down starkly in extremely heavy action before retreating to a 13.2% loss at $18.49.

Among the reams of financial stocks pulled down with Countrywide was online broker

E*Trade

(ETFC) - Get Report

, recently down 8.3% in furious trading. Commodities exchange

Nymex

( NMX) slid 10.4%; lender

CIT

(CIT) - Get Report

sank 7.5%; and broker

Goldman Sachs

(GS) - Get Report

was off 0.8% at $163.54 in heavier-than-usual trading.

On the other hand,

First Charter

(FCTR) - Get Report

soared 37.8% after the Charlotte, N.C., bank

agreed to sell itself

to

Fifth Third Bancorp

(FITB) - Get Report

for $31 a share in stock and cash -- a 53% premium to its latest close. The $1.1 billion deal should complete in the first quarter of next year. First Charter shares jumped $7.65 to $27.90.

Shares of Fifth Third, which was cut to underperform at Friedman Billings, shed $1.01, or 2.7%, to $36.37.

Friedman upgraded

KKR Financial

(KFN)

to outperform, however, after the San Francisco-based firm expressed belief that it has "ample liquidity" to meet its financial obligations and to keep its core business running. The company was in free fall yesterday after

selling

about $5.1 billion in residential-mortgage loans, but today shares surged 19.4% to $12.56 in partial recovery.

Among other positive analyst calls,

Washington Mutual

(WM) - Get Report

was upped to buy at Punk Ziegel, and a Citigroup analyst said

Sovereign

( SOV) has scant exposure to subprime-mortgage and alt-A loans. It, too, garnered a buy rating. Shares of the companies rose 7.5% to $35.01 and 4% to $17.25, respectively.

More broadly, the

NYSE

Financial Sector Index came up for air mid-afternoon after foundering in negative territory for most of the day. The tracker leapt 1.1% to 8,620.84. The KBW Index, which had a better day overall, was recently surging 2.63 points, or 2.6%, to 104.23.