Financial stocks generally underperformed the broad indices as credit-market vexations, the old story, continued pervading the air.
( MER) confirmed after the market close yesterday that it had indeed culled CEO John Thain from
take the reins at the beleaguered New York broker. News of the CEO appointment, which will take effect on Dec. 1, broke during the trading day yesterday. Credit Suisse upped Merrill to outperform.
It is hoped that Thain will, among other things, help to
heal Merrill's damaged culture following Stan O'Neal's five-year stint at the top. O'Neal was
pushed out a couple of weeks ago following Merrill's report of
big third-quarter writedowns, as well as his unilateral decision to contact
head Ken Thomson in order to
suggest a merger.
Merrill shares were off 1.7% to $56.97 after a brief foray into positive territory, and NYSE lost 2% to $85.01. Wachovia was recently down 2.6%.
( NFI), meanwhile, took a nose dive after it reported losing $408.1 million from continuing operations, or $43.99 a share, in the third quarter. That reverses last year's $1.81 per-share profit. NovaStar also believes there's a "high likelihood" it will be expelled from the
following a Dec. 5 review, at NovaStar's request, of that previously announced determination.
The Kansas City, Mo., firm had been among numerous subprime-mortgage lenders caught in the first wave of credit-market turmoil earlier this year, and its stock has lost a tremendous amount of value over the past few months. Today, shares surrendered nearly another 60% to $1.84.
Elsewhere, Punk Ziegal shaved down
( BSC) price target, and Bank of America sharply lowered its fourth-quarter bottom-line estimate to a loss from the prior profit expectation, as Standard & Poor's downgraded Bear's credit rating to A from A-plus. S&P also has a negative outlook on the New York-based brokerage.
This all follows Bear's prediction on Tuesday that it will
take $1.2 billion in fourth-quarter writedowns tied to mortgage-related securities. Shares had initially climbed as the company also sketched out making a steady recovery from the subprime mess in which it has been mired. Today, shares retreated 2.3% to $100.88.
lost ground after
The Wall Street Journal
reported that it might be facing a fourth-quarter writedown of 8 billion Swiss francs, or $7.11 billion. The Swiss bank denied this, according to
, but shares were still shedding 2.3% to $48.10.
And the Netherlands-based brokerage
Van der Moolen
( VDM) announced that it will delist itself from the NYSE, having decided to terminate its unprofitable VDM Specialists USA segment "as promptly as possible." Shares slid 9.9%.
The NYSE Financial Sector Index, sagging under the weight of all of the above stocks, recently lost 192.6 points, or 2.2%, to 8,565.61. The KBW Bank Index gave up 2.4% to 95.37.
On the flip side, Florida's
rose 4.7% to $8.06 after third-quarter income more than quadrupled from last year to $43.7 million, or $1.06 a share. Meanwhile,
continued to see a flurry of trading activity that kept shares mostly in the green today following Monday's
free fall. Recently, however, the stock was flat at $5.54.