Updated from 2:57 p.m. EDT
Financial stocks were hammered Tuesday, as Standard & Poor's warned it may cut ratings for mortgage-backed securities backed by subprime residential mortgages.
The rating agency said it could downgrade 612 classes of subprime mortgage-backed securities, citing increasing losses tied to less creditworthy borrowers. Such securities were central to the near-collapse of two multi-billion
hedge funds last month.
Bear Stearns shares closed down $5.93, or 4.1%, to $137.96.
was off $3.76, or 5%, to $71.10.
was down $6.22, or 2.8%, to $217.08.
shed $3.02, or 3.5%, to $82.36.
again dipped below its initial public offering price of $31. In afternoon trading, the
private-equity giant lost $1.55, or 4.9%, to $29.93.
was one of the few Wall Street investment banks to buck the downward trend Tuesday. The bank said it would acquire M&A advisory firm Goldsmith Agio Helms & Lynner for an undisclosed amount. "The acquisition of Goldsmith Agio Helms will allow Lazard to extend our reach to the vibrant middle market for our existing client base," said Kenneth M. Jacobs, CEO of Lazard North America. Investors liked the deal -- its first since Lazard went public in 2005 -- sending shares up 43 cents, or 0.9%, to $46.07.
got a 1.7% bump up after it announced it saw a June increase in trading on both its
New York Stock Exchange
and the Paris-based Euronext exchange. Shares jumped $1.33 to $77.80.
The Nasdaq Financial 100 index was down more than 67 points to 3119.75.