Bond insurers MBIA and Ambac Financial Group have seen stock prices suffer as worries grow that the insurers may be badly hurt by weakness in the subprime market, reports the Associated Press. Both companies have been trading much closer to their 52-week pricing lows than their 52-week pricing highs. Investors have been showing worry ever since Standard & Poor’s and Moody’s Investors Service downgraded billions of dollars in subprime bonds last week. S&P is now in the process of evaluating what effect bond performance will have on the insurers. “Preliminary indications are the impact is minimal,” said David Veno, director of global bond insurance ratings at S&P.
Bond Insurers’ Stocks Slide After Subprime Downgrades