Fannie Mae and Freddie Mac shares plunged Tuesday after a federal appeals court denied legal claims by investors who were seeking to stop the U.S. government from seizing the profits of the mortgage giants.
Fannie shares sank 35 percent to $2.71. Freddie shares tumbled 38 percent to $2.47.
Hopes for reform of the government-sponsored enterprises had lifted shares of Fannie and Freddie following President Trump’s election. Shares of Fannie went from a low of $1.26 to a high of $5.00, only to retreat after Tuesday’s ruling.