Updated from 2:11 p.m. EDT

Friday's depressed market yanked the financial sector lower even as a few names jumped on positive earnings.

One of the hottest financial stocks was Oak Hill Financial ( OAKF), a small Ohio bank that agreed to sell itself to WesBanco ( WSBC) for about $201 million, or $38 a share, mostly in stock. The deal will likely close late in the fourth quarter. Oak Hill shares rocketed more than 41.9% to $33.05.

WesBanco, which doesn't expect earnings accretion from the merger until 2009, was off 8% at $26.72.

Capital One ( COF), meanwhile, toppled estimates with second-quarter earnings of $750.4 million, or $1.89 a share, vs. $1.78 a share last year. Analysts polled by Thomson Financial were looking for $1.62. Shares of the Virginia-based credit-card company climbed $2.15, or 2.9%, to $77.66.

Capital One lent some support to the NYSE Financial Sector Index and the KBW Bank Index, but not nearly enough to fight against Friday's strong downward trend. The indices slid 1.6% and 1.5%, respectively.

Insurer Donegal Group ( DGICA) bounced 7.2% to $16.14 after pocketing 43 cents a share in the second quarter-- 2 cents more than last year and 7 cents higher than the mean Street target. Banking giant Citigroup ( C) initially traded higher after posting sharply higher continuing-operations income that bested estimates, but its shares retreated 0.8% to $50.73.

Wachovia ( WB) was also slipping Friday despite beating second-quarter Wall Street expectations by a penny, excluding special items. Its credit-loss provision about tripled from last year to $179 million, though it ticked up only marginally from last quarter. The stock was 3.2% lower at $49.98.

Elsewhere, asset manager Eaton Vance ( EV) dropped 2.9% on a downgrade to hold from buy at A.G. Edwards, and First Commonwealth Financial's ( FCF) second-quarter income was down a penny a share from last year to 16 cents. That came in a penny past expectations, but shares of the Pennsylvania bank still sank 3.2% to $10.18.

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