Industry News

Real estate stocks report sad results

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Countrywide, Countrywide, Countrywide. That was the mantra for real estate stocks in August as the giant mortgage banking company took investors on a roller-coaster ride. Shares opened Aug. 1 at $27.22 and closed 30 days later at $19.85, a loss of 27 percent. Countrywide's widely reported ups and downs seemed to overshadow positive developments at smaller IndyMac Bank. Roth Capital upgraded the company's rating from "sell" to "hold," and 600 employees reportedly were hired from American Home Mortgage, which filed for bankruptcy in August. Even better, IndyMac resumed origination of some jumbo home loans that had been cut back due to illiquidity in the secondary market and traded its first mortgage bonds, in two packages worth $240 million and $350 million, in five weeks. The company's shares mounted a comeback from $20.16 to $24.20, a one-month gain of 20 percent. The mortgage lending sector overall benefited from the Federal Reserve's cut in the discount interest rate that banks pay ...