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Bond insurer shares surge on home sales data
Tue Aug 4, 2009 3:19pm EDT Email | Print | Share| Reprints | Single Page[-] Text [+]
NEW YORK (Reuters) - Shares in bond insurers including MBIA Inc (MBI.N) and Ambac Financial Group (ABK.N) soared on Tuesday on better-than-expected home sales data.
The bond insurers, hurt by losses after a disastrous foray into guaranteeing mortgage-backed securities, appeared to surge on a report showing pending sales of existing U.S. homes rose for a fifth straight month in June, an analyst said.
Shares in Armonk, New York-based MBIA jumped almost 28 percent to $5.70 in afternoon trading, while shares in New York-based Ambac climbed as much as 30 percent to a high of 99 cents, even after that company warned July 27 of heavy losses from derivatives during the second quarter.
"Home sales appear to be getting better," said Jim Ryan, an analyst at Morningstar in Chicago.
Shares in bond insurers might be rising because an improving housing market would mean lower losses on mortgage-backed securities, he added.
Milwaukee-based mortgage insurers MGIC Investment Corp (MTG.N) and its smaller rival Radian Group (RDN.N) also saw their shares rise 11 percent and 10.6 percent.
MBIA will report its quarterly results on Thursday, and Ambac will report on Friday.
Ambac and MBIA have struggled to get new business after crippling losses from risky mortgage securities and rating agencies stripped the bond insurers of their triple-A ratings.
(Reporting by Elinor Comlay)
Anything new????
I think we have all seen that!
"ABK has finally secured a private financier to help launch Everspan. They put out this news release to drive down the PPS. Financier gets in at a great price. With earnings release around the corner, they release news about Everspan and PPS quadruples.
I think this is a high probability scenario - consdidering ABK has never made a press release about write downs a week or so before earnings were due". From another board!
I'm game!
Buy!!!!
A Form 4 regarding Ambac has been filed with the United States Securities and Exchange Commission.
Release Date: Not Confirmed 8/6/2009
Before Open
No sellers!!!.........The spring is ready to be sprung into earnings!!!!
Radian Grp To Make $100M Settlement Payment To Ambac Nice!!! ...
Buy now!
Good point!
I will sell, and just watch you guys from now on.....K?
Not a correction............. but yet,another transaction!
This looks interesting BTW!!!
http://www.bloomberg.com/apps/news?pid=2...
Paul Derosa just had 61887 share option Awarded Form4/A.
"Lawmakers and investors have pilloried S&P and its rivals for being a principal cause of the global credit crisis and recession for awarding pristine ratings to low-quality mortgages and other securities that quickly proved worthless.
In its proposed reforms to financial regulation, the Obama administration has called on S&P, Moody's Corp's (MCO.N) Moody's Investors Service, Fimalac SA's (LBCP.PA) Fitch Ratings and others to boost the integrity of their ratings, especially in structured finance, and to reduce conflicts of interest."
http://www.reuters.com/article/marketsNe...
Say sorry! LOL.
100% buys today..........Ambac insiders bought today?? Did you?
I think the company should say something soon regarding the S&P joke!!!!!
They came back with a PR on the Moody downgrade the same day........
For the company to say nothing with soooo much going on we are all either facked, of in for a great ride!
only time will tell.
GLTYA.......
Wow, 1MILL you have tooooo much time on your hands bro!
I think we all sit and wait for a great PR.....I like the run into one...............
Why you watchin me??????
BTW Myself an Bulldog still very green on this one.
prep for a big PR?????
11-k filed
Options Bullish on This Bond Insurer
Published: Tuesday, 23 Jun 2009 | 12:38 PM ET Text Size By: David Russell
writer, OptionMonster
Options action turned aggressively bullish on Ambac Financial Group today as traders snapped up calls in the heavily shorted bond insurer.
Call volume spiked to 27 times the average amount over the last 20 sessions. Almost all the buying focused on the January 2.50 calls, which traded 20,146 times for $0.15 to $0.30 against open interest of 17,999 contracts. Most of the activity occurred during a 10-minute period, suggesting purchases by a single large investor.
Options Tips from Jon Najarian
Read The CNBC Stock Blog
Options Tips from Pete Najarian
Ambac [ABK 1.10 0.08 (+7.84%) ], which is up almost 5 percent to more than $1 in midday trading, has fluctuated between $0.35 and $1.75 over the last six months. It would have to rally 164 percent for the calls purchased today to turn a profit on expiration.
The stock was one of the first to collapse in the mortgage crisis and still had a substantial short interest representing 15 percent of the float as of May 26. Small gains in the share price could trigger more buying as shorts rush to cover, creating a classic "squeeze" higher despite a lack of positive developments for the company.
Today's buyer may have purchased the calls as a hedge against such a short position. The distant month provides more delta, which means the options will appreciate more quickly than shorter-dated calls if the stock rallies. The longer expiration also reduces the likelihood of time decay eroding the position's value.
Calls in Ambac today outnumbered puts 1,635 to 1, reflecting the lopsided bullish trade.
I would not be surprised to see some great news today....
Trading very strange today!.........
"AMBAC is now starting it's move to position the company toward stability. The new team in place is cleaning house of the old mentality of throwing more money at the problem and discarding the old regime. As I stated back last month on numerous occasions, Some would have to fall on the sword for the bad risk taken. Many of you ask why Callen sold and I told you he had to sell and others would follow his exit path set by the new leadership team...Thanks but No Thanks!
People Everspan was the pipe dream of the old king of AMBAC! It was a menial business plan that opened the company up to further risk taking and predators wanting a large stake for very little.
This is a business and AMBAC is making all the right moves to exit this mess stronger. BK is not an option nor will it ever be but I tell you what this is not an entertainment company or media company. Stop pushing this company toward follow the leader business strategies. They should have cancelled Everspan long time ago but the Ole Boy network was pushing this crap!
More good news to come for you long term investors. Day traders have fun and short sellers your days are numbered. Why do you think the Feds left the rating companies alone with the restructuring of financials? They weren't the problem, manipulation, cheaters and contract integrity was the problem. (Bigger Fish to FRY!)
July will be good month for AMBAC, the new team is starting to lead and cleaning house of the old regime!
What we are experiencing is called shareholder value and accountability!Read and Educate yourselves..."
From another board.
Thomspons Reuters- ABK to OUTPERFORM 30-May-09 10:11 pm May 28, 2009
Composite Rating: Outperform
Fundamental Quality: Outperform
Technical Factors: Outperform
Value Catch-up: Outperform
Operational Trends: Neutral
Can be found on trading accounts in analyst research for ABK.
Sentiment : Strong Buy
Takefuji 16-Jun-09 12:57 pm Takefuji has entered talks with bond insurance group Ambac after its credit rating was downgraded to junk by Standard & Poor’s, triggering possible early redemption of Y109bn worth of the Japanese moneylender’s asset-backed securities.
S&P downgraded Takefuji’s credit rating to BB+ from BBB-, citing concerns about its financing capability and higher credit costs.
EDITOR’S CHOICE
Takefuji in Ambac talks after downgrade - Jun-16Takefuji faces funding shortfall - Jun-10Japan faces consumer finance fears - May-07Kabarai crisis highlights risk in Japanese finance - Sep-26Tokyo set to cap consumer loan rates - Jul-07Raised Takefuji stake fuels takeover talk - Jul-13As a result, the Japanese consumer finance group faces the prospect of having to redeem its Y109bn in ABSs earlier than scheduled unless it can come to an agreement with Ambac for easier terms.
Ambac, which has provided guarantees to investors in Takefuji’s ABSs, has the right to take ownership of Y302bn worth of its loan receivables if the Japanese group fails to redeem its Y109bn ABS issue.
Takefuji said it had entered discussions with the guarantor of its ABSs, but declined to provide details.
Although Takefuji is not obliged to redeem the ABSs as a lump sum, it could be forced to do so within one year, said Takehiro Tsuda, analyst at Nikko Citigroup.
The company also has Y56bn in other short-term borrowings, which Takefuji must repay by March 2010.
“The downgrade (by S&P) makes Takefuji’s funding environment even tougher,” Mr Tsuda said.
“As a result of the downgrade, we expect Takefuji to substantially revise its medium-term [recurring profit] target and think it will have to resort to an [overall business] reduction,” he said.
The group had Y97.9bn in cash and cash equivalents at the end of March.
Takefuji was likely to have to recover its loans in order to meet it repayment obligations, Mr Tsuda said .
Takefuji forecasts a decline in its loan balance to Y705.3bn by next March and Y573bn by March 2012.
But Mr Tsuda forecasts the group’s loan balance could shrink to Y560bn by the end of next March, or less than half the level at the end of March 2008.
The group has been one of the hardest hit by changes to Japan’s moneylending law, which is forcing consumer finance companies to slash their interest rates from a maximum of 29.2 per cent to about 18 per cent.
Consumer finance groups have also faced a high level of interest payment refund claims, after court rulings opened the way for borrowers to seek redress over high loan rates.
In the year to last March such payments amounted to Y145bn for Takefuji and claims have remained high this fiscal year.
The legal changes have forced consumer finance groups to set aside massive reserves each year to cover their potential payments.
In the last financial year, Takefuji set aside Y229.7bn in interest refund reserves and suffered a net loss of Y256.1bn.
Everyone done tugging on each other?????
Looks like it.....................
Fed Should Stop Buying Treasurys: Steve Forbes
Topics:Credit Cards | Credit | Debt | Bonds | Central Banks | Banking | Bailouts | Interest Rates | Politics & Government | Recession | Federal Reserve | Inflation | Economy (U.S.) | Treasury Department | Economy (Global)By: CNBC.com | 15 Jun 2009 | 04:21 AM ET Text Size The Federal Reserve should stop buying government debt and instead focus on kick-starting areas of the credit markets having to do with consumers, Steve Forbes, Forbes CEO, told CNBC Monday.
"Amazingly, since December the Fed's balance sheet hasn't grown one single dollar. The Federal Reserve has been tight-fisted, amazingly, in the last five months," Forbes told "Squawk Box Europe."
RELATED LINKS
Current DateTime: 01:22:15 15 Jun 2009
LinksList Documentid: 31364659
Regulators Feud over Reform
Fed Bond Purchases Rises Unlikely
Housing May Feed Recovery Hopes
"I think the Fed should announce first they're not going to buy any more Treasury securities. Cash in the banking system is not the problem the problem is that parts of the credit economy are still not working," he added.
The Federal Reserve should "aggressively" buy mortgage-backed securities, to get housing sales moving again, and it should buy packages of credit car loans, car loans and other types of credit, as they promised to do, Forbes explained.
"It doesn't have to balloon its balance sheet, but it does have to pump, literally, hundreds of millions of dollars" into this system to get credit going again, he added.
The US regulators plans for reform, which include making the Federal Reserve a systemic regulator for financial institutions and regulating all derivatives contracts are likely to be hotly debated by lawmakers, according to Forbes.
"In terms of regulation it is a bit ironic they're still going to put new powers in the Federal Reserve, which is an agency that, one, didn't exercise proper oversight over the banking system that it had already under its purview and its lousy monetary policy in 2003 and 2004, when it printed all this excess money, made the bubble possible. I think this is going to be really debated by the US Congress," Forbes said.
On the economy, he said the worst of the recession was over and the financial markets had recovered from the lows hit in March, but the financial system was still not functioning properly as there was very little credit available for small companies and consumers.
© 2009 CNBC.com
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Ya.......I'm shocked!!!! This is pretty much a cherry grab for any daytrader....LOL....NOT!!!!!
If you are up at this point, and can jump prior to the big sell off that's just around the corner..............I would!!!!
Watch and learn!
Go CAGINAIANS....Caginators.....Cagipollusas.....Cagistock!!!
WWWWWWWWWWWWWWWWWWWWWWWEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEE
READYTTTTTTTTTTTTTTTTTTTTTTTTTTTOOOOOOOOOOOOOOOOOOOOOOOOOOODUMPPPPPPPPPPPPPPPPPPPPPPPPPPPPPPPPPPPPPPPPPPPPPATRUCKKKKKKKKKKKKKKKKKKKKKKKKKKKKKKKKKKKKKKKKKLOADDDDDDDDDDDDD!!!!!!!!!
This will never see another PR!!!!!!!! 100%
Your worse than I am!!!!!! I found Prozac and buying bigboard winners helps!!!!
LMFAO!!!!!!
Thomspons Reuters- ABK to OUTPERFORM 30-May-09 10:11 pm May 28, 2009
Composite Rating: Outperform
Fundamental Quality: Outperform
Technical Factors: Outperform
Value Catch-up: Outperform
Operational Trends: Neutral
Can be found on trading accounts in analyst research for ABK.
Sentiment : Strong Buy
Mark this post!!!!This POS AKA..CAGI will never do another PR!!
If this post gets deleted....that says it all!
Nu-b, copy this for me Bro?
What happened to your post yesterday that confirmed that this was a scam?????
Why do they say they do??????
my point is, every scam is out of the same F'N "Office"!!!
Do you think Cagi is tired of sharing their office and phone/fax with Wagerphone????
www.wagerphone.com LOL........
That 3555 Don Mills ............I'm glad we got in early!!!!!!
My finding.................
Thanks for backing Nu-b...
The same boiler room!!!!
This is not a location that exists............
I'm from Toronto!!!!!!!
It's a building with a Pizza joint and a TD bank and some other crap!..............No wagerphone/or CAGI.
I have a statement with regards to CAGI.....the office on DonMills is total BS!!!!!! That is a fact!!!!!
Interesting......MBI. and AGO are both up 10%+ and ABK is red!!!!
MM holding a good man down.....I would say this is a great spot to jump back in...if you r out.....or avy down...or up??????LOL
We be ready to POP...........
Look for it in PM!
GLTYA.
We float to those levels very soon....
I just remembered who wrote that great big story re: the short position on this POS!!!!!
I fell for it, hook line and sinker!!!
Nu-b I own restricted shares for this POS aswell!!!!!
Remember Armondo Russo owns The Tappo restaurant in Toronto with Shane Corson........
He was contacted Re NWWV and did not even know what that was!!!
Bulldog got worked aswell!!!!!
Stewie is from Barrie.........that's prob him on FB!!
These guys should be locked up!!!!
Well this is cool!!!!!!!
http://www.insurancetimes.co.uk/story.asp?storycode=378532