Shares in local mortgage lenders and homebuilders jumped early Thursday after federal regulators decided Wednesday to allow Fannie Mae and Freddie Mac to buy more mortgages.
Shares in Calabasas-based lender Countrywide Financial Corp. shot up 7.5 percent in early trading Thursday to $5.49 putting shares in the struggling lender up more than 20 percent for the week. Shares in Pasadena-based lender IndyMac Bancorp Inc. were up 3.1 percent to $5.05.
The stock of Los Angeles-based homebuilder KB Home added 5.1 percent to $24.21 while shares in its Calabasas-based rival Ryland Group Inc. added 5 percent to $30.96.
The move by government officials to ease the mortgage restrictions will allow Fannie Mae and Freddie Mac to buy a wider range of mortgages essentially adding more liquidity to the struggling mortgage industry.
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