Shares of MBIA Corp. fell on Monday after Standard & Poor's said it will drop the bond insurer from the S&P 500, a key index of major stocks.
Shares of MBIA fell 29 cents, or 7.9 percent, to $3.38 in midday trading, following Friday's announcement by S&P. MBIA and four other companies are being dropped from the S&P 500 on the close of trading on Dec. 18 because S&P no longer considers those stocks representative of the broad market indicator.
A stock's impending removal from the S&P 500 typically causes shares to drop. That's because index mutual funds that track the S&P 500 must eventually sell dropout stocks and replace them with new S&P 500 stocks to accurately reflect the index.