US housing-linked stocks plunge amid new mortgage market fears
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mortgage market, us housing March 12th, 2008US housing-linked stocks plunge amid new mortgage market fears
By Ben White and Saskia Scholtes in New York
Published: March 11 2008 02:00 | Last updated: March 11 2008 02:00
Shares in Bear Stearns, Fannie Mae, Freddie Mac and other leading housing financiers plunged yesterday amid widening concerns about the health of the US mortgage market.
Fannie fell 13 per cent, Freddie 11.5 per cent and Bear 11.1 per cent as housing concerns helped send the broader market lower. The S&P 500 lost 20 points - or 1.55 per cent - to 1273.37, its lowest level in more than 18 months.
“If liquidity is the elixir of life for any Wall Street firm, the current market certainly has the potential to be lethal,” said Kenneth Hackel, managing director of fixed-income strategy at RBS Greenwich Capital Markets, said in a note to clients.
Bear shares were down as much as 14 per cent during a day in which the investment bank - a big underwriter of mortgage-backed securities - publicly confronted rumours that it could be facing a liquidity crisis.
Such rumours have circulated since Bear ran into trouble in the summer.
Tags: mortgage market, us housing
