国际英语新闻：Wall Street rallies as U.S. gov't takes over mortgage giants

NEW YORK, Sept. 8 (Xinhua) -- Wall Street rallied Monday as the U.S. government's unusual move to bail out mortgage giants Fannie Mae and Freddie Mac.

The Treasury Department announced Sunday that it was seizing control of the companies, which own or back about half the nation's mortgage debt.

    However, the bailout plan would wipe out the two companies' common and preferred shareholders. Shares of Fannie and Freddie plunged more than 80 percent Monday, trading at about 1 dollar per share.

Secretary of the Treasury Henry Paulson (L) and Jim Lockhart, Director of the the new independent regulator, the Federal Finanace Agency (FHFA), announce that the government is taking control of mortgage finance companies Fannie Mae and Freddie Mac during a news conference at the Office of Management Supervision in Washington, DC, Sept. 7, 2008

    The financial sector rebounded strongly Monday on the news. Shares of Bank of America and Citigroup rose more than 4 percent.

    Investors hope the bailout of Fannie and Freddie will shore up confidence in the mortgage market and stem a wave of bank write-downs.

    The Dow Jones industrial average rose 289.53, or 2.58 percent, to 11,510.49 after rising nearly 350 points in the early session. The Standard & Poor's 500 index advanced 25.49, or 2.05 percent, to 1,267.80, and the Nasdaq composite index added 13.88, or 0.62 percent, to 2,269.76.