Stocks Rebound, Countering Selloff in Financials

Bear Stearns buyout sends JP Morgan up, Lehman Brothers down
By Kevin Spak,  Newser Staff
Posted Mar 17, 2008 10:17 AM CDT
An employee of the Korea Stock Exchange watches update of stock price on a monitor screen at the Korea Stock Exchange in Seoul, South Korea, Monday, March 17, 2008.    (AP Photo)
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(Newser) – Stocks steadied after steep early morning losses today, with the Dow actually rising 1.06 points by mid-morning, the Wall Street Journal reports. But financials were still down big, as the Bear Stearns fire sale loomed large over the market. Lehman Brothers, down 22%, was hit the worst, other than Bear itself, which nosedived 87%. Still, at $3.79, it remained stubbornly above its $2 buyout price.

JP Morgan is paying just $236 million to acquire Bear Stearns, a bargain basement acquisition the market approved of, rewarding JP Morgan stock with an 11% climb. But there was still unease in the air, as investors wondered why the Fed had cut the discount rate just a day before the FOMC meeting. The S&P 500 is down 8.74 points, while the Nasdaq is down 23.11.