No relief for financial firms as failure rumors surge again

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Can it get any worse for financial stocks? Oh yes it can. Here’s the rundown on today’s crises:

--FANNIE MAE and FREDDIE MAC: Shares of the mortgage giants plummeted again on fears that they won’t survive without a government bailout that could wipe out their shareholders’ stakes. Fannie fell as low as $11.70 early today, from $15.31 at Wednesday’s close; Freddie fell as low as $6.75, from $10.26.

The stocks have since rebounded somewhat as Treasury Secretary Henry M. Paulson Jr. and a host of politicos have tried to assure investors. Paulson, testifying on Capitol Hill at a previously scheduled hearing on financial regulation, said Fannie and Freddie were ‘adequately capitalized.’

But that was contradicted by Federal Reserve Chairman Ben S. Bernanke, who said at the same hearing that he believed the companies needed to raise more capital.

On Wednesday, former Federal Reserve Bank of St. Louis President William Poole labeled Freddie as ‘insolvent’ in an interview with Bloomberg News and said Fannie was on the verge of insolvency.

The market is voting with Poole: At about 11:45 a.m. PDT Fannie still was off $1.81 to $13.50; Freddie was down $2.10 to $8.16.

--LEHMAN BROS.: The brokerage’s shares plunged as low as $15.40 early today, in part on rumors that Newport Beach-based bond fund titan Pimco had stopped trading with the firm because of concerns it could fail. Deja vu? In mid-March, Bear Stearns Cos. collapsed when its trading partners pulled away.

But Bill Gross, Pimco’s chief investment officer, went on CNBC today to say Pimco hadn’t backed off from Lehman. He said Pimco had ‘no question’ about Lehman’s solvency.

Lehman shares were off their lows at about 11:45 a.m. PDT but still were down $3.22 to $16.52.

--WACHOVIA CORP.: The market is giving no rousing welcome to Robert Steel, the former Treasury undersecretary who was named CEO of struggling Wachovia on Wednesday by the bank’s board. The shares are off 81 cents, or 5.7%, to $13.48, a 17-year low, after Steel declined to answer questions about the bank’s capital situation or its dividend, saying investors would have to wait for the company’s second-quarter earnings report on July 22.