Financial stocks leapt higher than the broad market ahead of this afternoon's Federal Reserve meeting Tuesday after skimming negative territory for most of the morning.

RAM Reinsurance ( RAMR) was a big winner after CEO Vernon Endo announced that "contrary to a story that was issued in the press," the Bermuda-based firm continues to have access to its $50 million "soft capital" facility. He also said that RAM is not currently trying to raise more capital. Shares soared 24.3% to $7.98 to take back some of Monday's huge losses.

Evercore Partners ( EVR), a New York asset manager, posted adjusted pro forma income of $15.5 million, or 47 cents a share, nearly doubling last year's earnings and powering past Thomson Financial's estimate of 36 cents a share. Evercore also upped its quarterly dividend by 20% to 12 cents a share. Its stock jumped $1.16, or 5.8%, to $21.16.

Elsewhere, Roth Capital raised IndyMac Bancorp's ( IMB) rating to hold from sell on valuation, boosting shares by as much as 13% but lately up 1% at $19.76. Memphis-based First Horizon National ( FHN) climbed 8.6% on a Friedman Billings upgrade to market perform from underperform but was recently up 3.7% at $31.16.

In more brokerage-spurred action, Assurant ( AIZ) added 4.5% after Merrill Lynch raised the stock to buy. The analyst, who set a $64 price target, predicted that the subprime-mortgage fallout will help bring in more policies for Assurant's sizable homeowners-insurance unit. Shares of the New York-based company were trading at $50.88.

All but one of the above stocks gave legs to the NYSE Financial Sector Index, which was recently spiking 67 points, or 0.7%, to 9,136.14. The KBW Bank Index performed even better, lately jumping 0.9% at 108.31.

On the downgrade side of analyst calls, however, Deutsche Bank cut Thornburg Mortgage ( TMA) to sell on broad credit-market concerns, notwithstanding the solid quality of its loans. Shares of the Santa Fe, N.M., mortgage lender slid 8.5% to $21.75.

Luminent Mortgage ( LUM) took an 81.5% nosedive in very heavy trading after suspending its 32-cent-per-share dividend amid a "significant increase in margin calls on its high quality assets and a decrease on the financing advance rates provided by its lenders."

Luminent was hit with several downgrades on the heels of this news, among them harsh cuts to underperform from outperform at Friedman Billings and at JMP Securities. Shares were plunging $3.57 to 81 cents.

CBRE Realty Finance ( CBF) foundered as well, after swinging to a 4-cent loss per share in adjusted funds from operations (AFFO). Analysts were expecting a 22-cent upside. The Hartford, Conn., real estate investment trust also slashed its 2007 AFFO guidance to between 60 and 70 cents a share vs. the prior $1.10 to $1.20 a share -- at least 35 cents below expectations. Shares plummeted 31.6% to $4.25.

New York's Marsh & McLennan ( MMC) sank 3% to $26.85 after the insurance broker's second-quarter continuing-operations profit totaled just 29 cents a share (excluding items), or 7 cents short of consensus. Conseco ( CNO), an Indiana-based insurer, widened its loss to 38 cents a share from 21 cents a year ago. Shares lost 7% to $16.83.

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