Tag - Ptc

After opening lower, small-cap stocks have continued their steady decent, as concerns surrounding the financial sector, a rebound in crude oil prices and dismal corporate earnings overshadowed the Senate’s passage of the housing bill. 

At 12:22 p.m. ET, the Russell 2000 (NYSE:IWM) was down 7.73, or 1.09%, to 702.61, while the Dow was down 125.46, or 1.1%, to 11,245.23.

Federal regulators seized two small banks over the weekend, which has cast a rain cloud over the financial sector today. The FDIC took over the First National Bank of Nevada and First Heritage Bank NA of California and sold the banks to Mutual Omaha Bank. Small banks dominated the list of largest percentage losers on the Nasdaq Exchange early this morning.

The bank seizures overshadowed the Senate’s passage of a housing bill on Saturday that creates a backstop for Fannie Mae (NYSE:FNM) and Freddie Mac (NYSE:FRE) should the mortgage lenders fall off a ledge. The legislation calls for an extension of a limitless line of credit for both firms for a year and a half and bestows authority to the Treasury department to purchase shares should the companies find themselves faced with insolvency.

Crude oil prices are pushing higher on the session, up $1.19 to $124 a barrel in midday action. The commodity is gaining ground on account of reports of attacks on oil pipelines in Nigeria and a fire at a Kuwait refinery.