Updated from 2:18 p.m. EDT with new stock pricesThe financial sector traded in the green through early afternoon Wednesday amid positive earnings out of names such as JPMorgan Chase ( JPM). The New York brokerage jumped 2.79% after its third-quarter profit
Fellow insurer Midland ( MLAN) was among the day's biggest price gainers after Germany's Munich Re agreed to buy it out for $65 a share in cash. The $1.3 billion deal should close in the first half of 2008. Shares of Ohio-based Midland vaulted $6.30, or 11%, to $63.57. Elsewhere, Reuters reported that Morgan Stanley ( MS) is laying off about 300 employees largely from segments hit hardest by the credit crunch, according to a person familiar with the situation. Shares booked early gains but were finished up only 0.78% to $65.81. Thornburg Mortgage ( TMA), meanwhile, plunged 11.93% after the struggling New Mexico mortgage lender
suspended its dividend and swung to a third-quarter loss of $1.08 billion, or $8.83 a share, against a year-ago profit. Analysts were seeking a loss of $7.98 a share, less special items. Contributing heavily to the bleak results was a $1.09 billion writedown from the sale of $21.9 billion in adjustable rate mortgage assets. Thornburg shares were trading at $10.04. MGIC Investment ( MTG) also reported a big third-quarter loss -- $4.60 a share -- to reverse last year's $1.55-a-share profit. The Milwaukee-based mortgage insurer primarily cited losses on its exposure to subprime-mortgage investor C-BASS (Credit Based Asset Servicing and Securitization). Shares slid 15.26% to $26.16. Likewise, New York lender CIT ( CIT) swung to a loss in that quarter and moreover set plans to sell $600 million worth of equity units, initially consisting of a contract to purchase CIT stock and a 2.5% interest in a $1,000 senior bond. Underwriters will have an option for another $90 million worth of units. Shares were down 5.77% to $34.98. Also reporting dwindling third-quarter bottom lines were asset manager Piper Jaffray ( PJC) and banks Fulton Financial ( FULT) and Hancock ( HBHC). Shares slumped 5% or more. Finally, Fremont General ( FMT) filed delayed first-half results that revealed huge losses from its subprime-lending business and from costs associated with shutting it down. The total loss for that period came to $855.8 million, or $11.10 a share. Excluding those items, which are classified as discontinued operations, the company had a small break-even profit. Shares sank 6.77% to $3.72 in heavier-than-usual trading.