Financial Stocks Dropping In Broad-Based Slide; Ebix Plummets After Goldman Sachs Scraps Buyout Amid Fed Probe

By Staff,

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Financial stocks are keeping pace with the steep downdraft for stocks today with the NYSE Financial Sector Index falling 2.1% and the S&P Financial 100 Index declining 1.4%.

In company news, Ebix Inc. ( EBIX ) is down near 40% to around $11.90 a share, earlier tumbling to a new 52-week low of $9.85 after Goldman Sachs ( GS ) scrapped plans to buy the insurance-software firm after a U.S. Attorney's office opened an investigation into allegations of intentional misconduct by EBIX.

EBIX and a GS affiliate were slated to merge in a $-mln transaction announced May 1. But GS said it decided to terminate the deal after the U.S. Attorney for the Northern District of Georgia told EBIX late last week it had opened an investigation into allegations of intentional misconduct contained in shareholder class action lawsuits against the Company's directors and officers, the media and other sources.

Both the Securities and Exchange Commission and the IRS reportedly have also taken an interest in the company - specifically, in EBIX's foreign operations in countries like India where it pays lower tax rates than in the United States. Ebix has vehemently denied any wrongdoing.

In other sector news,

(+) ALL, (+0.4%) Estimates its pre-tax catastrophe loss during May totaled about $323 mln, with three severe weather-related evenut accounting for over 90% of the estimated loss. The insurer previously reported a $216-mln pre-tax loss in April, bringing its Q2 loss so far of around $539 mln.

(-) AGNC, (-3.9%, has hit fresh year lows) Declares cash dividend on its 8% Series A cumulative redeemable preferred stock of $0.50 per share, payable July 15 for shareholders of record on July 1.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

Copyright (C) 2014 All rights reserved. Unauthorized reproduction is strictly prohibited.

This article appears in: Investing Commodities
Referenced Stocks: EBIX , GS

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