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Tuesday's Financial Winners & Losers

Lehman Brothers climbs on an earnings beat.
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Updated from 1:53 p.m. EDT

Financial stocks were climbing higher than most ahead of this Tuesday's highly anticipated rate-cut decision from the

Federal Reserve

, and individual names like

Lehman Brothers


also helped to lighten the mood.

The broker's shares gained 10% to $64.49 on third-quarter earnings that were

better than expected, if slightly lower than last year -- $870 million, or $1.54 a share, vs. Thomson Financial's $1.47 average per-share estimate. Chief Financial Officer Chris O'Meara also delivered some

soothing comments this morning, intoning that the "worst of credit correction is behind us."

Lehman helped give legs to the


Financial Sector Index, which jumped 348.8 points, or 3.9%, to around 9226.

Capital One

(COF) - Get Capital One Financial Corporation Report

bolstered the index, as well, after announcing it intends on paying out some 25% of its 2008 income in fixed quarterly dividends. Shares spiked 6.9% to $69.73 as the KBW Bank Index, of which the credit-card company is also a member, gained 4.6% to about 110.5.

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Fellow credit-card concern

American Express

(AXP) - Get American Express Company Report

added 4.5% to $60.80 after Standard Chartered agreed to buy its international banking unit for about $1.1 billion. The exact value of the transaction, which should close in the first quarter, is the net asset value of the unit's businesses at the closing date plus $300 million.

Among few financial losers today was online broker


(ETFC) - Get E*TRADE Financial Corporation Report

, which said it will exit or restructure "non-core businesses that lack a direct and strategic connection with its retail customers," including a departure from wholesale mortgage. E*Trade

deflated its 2007 guidance to between $1.05 and $1.15 a share (on a GAAP basis), citing the restructuring and an increased loan-loss provision. The prior range had been $1.53 to $1.67 a share.

Shares sank 21 cents, or 1.5%, to $14.

A number of nonprime-mortgage concerns were also on the decline today, among them

Impac Mortgage

(IMH) - Get Impac Mortgage Holdings Inc. Report

. Shares slid 5.7% to $1.66 after the Irvine, Calif., company said it will exit the Alt-A mortgage business and lay off 144 employees due to the "severe dislocation of the market place," including "unprecedented" margin calls. Moreover, Impac doesn't expect to pay common-stock dividends for the rest of the year.

NovaStar Financial


will shed its REIT status retroactive to Jan. 1, 2006, after

canceling its dividend, which was required at around $157 million in 2006 taxable income. NovaStar blamed its precipitous stock-price decline over the past few months, liquidity struggles and other factors. Shares of the Kansas City, Mo., company gave up 2.6% to $8.03.


Accredited Home Lenders

(LEND) - Get Amplify CrowdBureau Online Lending and Digital Banking ETF Report

, of San Diego, Calif., closed down 4.9% after filing its delayed first-quarter financials, which revealed it had swung to a big loss -- $260.2 million, or $10.29 a share, compared with a profit of $35.8 million, or $1.61 a share, a year earlier.

The company also said it cannot assure investors it will continue to operate as a going concern, citing "significant challenges due to adverse conditions in the non-prime mortgage industry." Shares closed at $9.78.