7/14T8:32 Stocks in the News

Pressed to act, SEC to probe false rumors about market - WSJ
The Wall Street Journal reports the SEC says it is cracking down on firms or individuals that illegally spread false rumors. The announcement was timed to be released hours before the trading week began in Asia, in hopes it would serve as a warning shot to traders, a senior official said. Meanwhile, executives at Lehman Brothers (LEH) were working on a plan to put the firm on more solid footing and stop the free-fall in the co's stock. Lehman is examining a handful of options, including a strategic alliance with a partner that it hopes will help restore investor confidence, an asset sale or possibly some sort of stock buyback, according to people familiar with the matter. Nothing final has been decided, but Lehman executives have long pushed for SEC action to stop the rumor mongering around their stock. Sunday, people close to the firm said Lehman hopes the SEC move will stop the fall of its stock until it has time to put together a plan. The SEC said it would join with other Wall Street regulators, the Financial Industry Regulatory Authority and New York Stock Exchange Regulation to immediately begin examining the supervision and compliance programs at brokerage firms and hedge funds to ensure training and other oversight programs concerning the sharing of information are up to par. The joint examinations will begin in earnest this week. Also over the weekend, senior members of the Federal Reserve, the SEC, and executives from Lehman participated in conference calls on the difficult situation facing the firm, according to people familiar with the matter. SEC staff members were expected to be dispatched to Lehman's midtown Manhattan office building Monday, a person familiar with the matter said.

Paulson seeks authority to shore up Fannie, Freddie - Bloomberg.com
Bloomberg.com reports Treasury Secretary Henry Paulson put the weight of the federal government behind Fannie Mae (FNM) and Freddie Mac (FRE). Paulson, speaking on the steps of the Treasury facing the White House, asked Congress for authority to buy unlimited stakes in and lend to the companies, aiming to stem a collapse in confidence. The Federal Reserve separately authorized the firms to borrow directly from the central bank. The announcements followed weekend talks between the firms, government officials, lawmakers and regulators, after Fannie Mae and Freddie Mac lost about half their value last week. Paulson and Fed Chairman Ben S. Bernanke are trying to prevent a collapse that would exacerbate the worst housing recession in 25 years and deepen the economic slowdown. Paulson's proposal, which the Treasury anticipates will be incorporated into an existing congressional bill and approved this week, signals a shift toward an explicit guarantee of Fannie Mae and Freddie Mac debt. Freddie Mac is scheduled to sell $3 bln in short-term notes this morning, and Paulson's comments indicate a concern about a collapse in private investors' willingness to fund the firms.

Treasury Secretary Paulson announces GSE initiatives for FNM and FRE - U.S. Dept. of Treasury
Treasury Secretary Henry M. Paulson, Jr. issues the following statement via the U.S. Dept. of Treasury website: "Fannie Mae (FNM) and Freddie Mac (FRE) play a central role in our housing finance system and must continue to do so in their current form as shareholder-owned companies. Their support for the housing market is particularly important as we work through the current housing correction. GSE debt is held by financial institutions around the world. Its continued strength is important to maintaining confidence and stability in our financial system and our financial markets. Therefore we must take steps to address the current situation as we move to a stronger regulatory structure. In recent days, I have consulted with the Federal Reserve, OFHEO, the SEC, Congressional leaders of both parties and with the two companies to develop a three-part plan for immediate action. The President has asked me to work with Congress to act on this plan immediately. First, as a liquidity backstop, the plan includes a temporary increase in the line of credit the GSEs have with Treasury. Treasury would determine the terms and conditions for accessing the line of credit and the amount to be drawn. Second, to ensure the GSEs have access to sufficient capital to continue to serve their mission, the plan includes temporary authority for Treasury to purchase equity in either of the two GSEs if needed. Use of either the line of credit or the equity investment would carry terms and conditions necessary to protect the taxpayer. Third, to protect the financial system from systemic risk going forward, the plan strengthens the GSE regulatory reform legislation currently moving through Congress by giving the Federal Reserve a consultative role in the new GSE regulator's process for setting capital requirements and other prudential standards. I look forward to working closely with the Congressional leaders to enact this legislation as soon as possible, as one complete package."

ATW Atwood Oceanics announces one-well commitment for ATWOOD FALCON (54.67 +1.32)
Co announces that the ATWOOD FALCON has received a one-well commitment from an operator in Southeast Asia for the drilling of a well in the South China Sea. The drilling of this one well will commence in mid July 2008 at a dayrate of $425k, with an approximate duration of 40 days; after which the rig will return to its current contracted dayrate of $160k. The rig is currently under contract with Sarawak Shell Berhad/Sabah Shell Petroleum in the South China Sea.