Monday meltdown on one of the lightest volume days of the year, as financials finished down (0.82%) after another choppy session. The market got heavy into the close as the XLF and KRE both dipped 1% after an appeals court ruled the Federal Reserve would have to release documents naming banks that might have failed without the U.S. gov’t bailout, perhaps causing irreparable harm to the institutional borrowers. Financial services lagged the sector off (1.37%) with mortgage insurers, lenders and online brokers the heaviest names.
Leaders:
CHC +4.33%, KCAP +3.57%, MXGL +3.00%, DRL +2.65%, SBIB +2.37%, LAZ +1.93%, GHL +1.88%
Laggards:
AGM -9.54%, UCBI -7.06%, UCBI -7.06%, FBC -6.87%, MSFG -6.24%, TBBK -5.69%, STU -5.27%
Big Banks
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BAC, C, WFC, JPM, GS, MS, FITB, STT, USB, HBAN, HCBK, PBCT, FHN, RF, BBT
Mid/SmallcapBanks/S&L
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FBP, WAL, EWBC, GSBC, HMPR, IBKC, PRWT, RBPAA, WBCO,NYB,DCOM,SBIB,CVBF,GAIN,LKFN,TFSL,IBCP,BRKL
Brokers
KCG, SCHW, AMTD, ETFCD
Asset Managers/Inv co’s
- BX, FIG, GLG, GROW, JNS, LAZ, MF, LM,KFN
Insurance
- GNW, HIG, MET, ALL, TRV
CreditCards
- AXP, COF, MA, V, DFS
Specialty Finance/Mort Insurers
- ACAS, ABK, MBI, MTG, RDN
BAC
Bank of America settles Countrywide data theft case - LA Times ($12.87)- In an agreement approved today by a federal judge in Kentucky, BAC is offering free credit monitoring, identity theft insurance, and reimbursement for up to $50K of losses to as many as 17M consumers. The bank continues to deny all allegations of wrongdoing in the more than 30 lawsuits that were settled, including class actions. A spokeswoman says the bank does not know what the cost of the settlement will be; the LA Times reported 3-Aug that BAC's Countrywide Financial Corp would pay $600M to settle the class-action lawsuits.
NYT looks at judges' recent disposition against banks and the way government is treating them-
The article does not break any news. In recent cases against Bank of America (BAC), Citi (C), and Barclays (BARC.LN), judges have questioned the laxness of penalties the government is imposing on banks and the government's failure to file charges against bank executives. The article notes that judges have limited power over settlements, and the effect of their vocal discontent over the long term remains to be seen. Some think the government will impose harsher penalties, to get easier judicial approval, while others think the government will move toward even more lenient ones, which do not require judicial approval at all.
MBI
MBIA files mixed securities shelf of indeterminate size ($8.80)
Deutsche Bank initiates AXS, RE, TRH
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Axis Capital Holdings (AXS) initiated buy with $35 target
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Everest Re (RE) initiated buy with $92 target
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Transatlantic Holdings (TRH) initiated buy with $53 target
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