Spice Up Your Expirey

So the SEC finally rules on Fannie Mae's (FNM:NYSE) accounting and it seems the company will restate earnings by $9B. The market cap is only $68B but I am not really sure this news will surprise people too much. I have had a hard time understanding why anyone would stay long that stock in the face of the SEC investigation so I don't really know what to expect tomorrow. The 50 day is just above $69 and there is a support line around $65. Will be something to watch I guess.

The other interesting news I see is that GM spreads are widening because of the dispute with Fiat. The story contains this gem:

GM is already under pressure from weak vehicle sales in the US and large pension and healthcare liabilities. Following disappointing third-quarter earnings, Standard & Poor's downgraded the company to Triple B minus, the lowest investment-grade rating.

The rating agency said on Tuesday it was concerned about the potential ramifications of this situation for GM's credit quality, adding that a downgrade to junk status was unlikely - but could not be discounted. Its outlook is currently "stable.

GM's stock has been looking like it wants to bottom but it is still below the 50 day average and well within its downtrend for the year. A bit difficult to see why bank shares would have been so strong today in the face of these two stories which seem to go pretty straight to the risks in the banking sector.