Wall St. rattled by worries over mortgage giants
Posted: 12 July 2008 0559 hrs
NEW YORK - Wall Street endured heavy losses Friday amid sustained worries over the financial health of two big mortgage-financing firms and lingering concerns about corporate earnings, traders said.
The downward spiral was led by Freddie Mac and Fannie Mae as fears mounted about the financial stability of the two firms, which help prop up the vast US mortgage market, amid a lingering housing market slump.
The blue-chip Dow Jones Industrial Average fell 128.48 points (1.14 percent) to close at 11,100.54.
The Nasdaq composite index shed 18.77 points (0.83 percent) to 2,239.08 and the Standard & Poor's 500 index declined 13.90 points (1.11 percent) to a close of 1,239.49.
....
Concern about their financial health has rippled through Wall Street because the two firms own or guarantee over five trillion dollars in loans, or about 40 percent of the total value of home loans in the United States.
AFter losing some 50 percent at the opening, Freddie Mac's shares ended down 3.1 percent at 7.75 dollars while Fannie Mae dived 22 percent to 10.25 dollars.
