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Two Harbors Responds to UWM's Baseless Lawsuit

Two Harbors (TWO) responded to the "baseless" lawsuit filed against the company by UWM Holdings (UWMC): "As previously disclosed, the TWO board of directors, consistent with its fiduciary duties and its contractual obligations, has secured $12.00 per share in cash for all TWO stockholders in a transaction with CrossCountry Mortgage (CCM). The CCM transaction, which was approved by TWO shareholders on July 2, 2026, is scheduled to close as soon as the last state regulatory approval is received, which is expected in August. The lawsuit filed by UWMC is frivolous and raises serious questions about UWMC's public disclosures. TWO's previously released concerns regarding UWMC's intent and/or ability to close any transaction with TWO has now been thoroughly vindicated. UWMC's stock price has collapsed - it is down almost 70% year-to-date, after UWMC finally disclosed its $600 million derivatives loss, which had been rumored to have occurred since May 19, 2026. The loss highlights the dire condition of UWMC's balance sheet, liquidity and also casts doubt on its risk management and other governance practices. UWMC now says that this loss was related to a "hedge" of TWO's MSR portfolio -- a portfolio that was already expertly hedged by TWO, not owned by UWMC, and under a binding contract to be sold to CCM. UWMC wishes the market to believe that its $600 million loss is related to a risk position that was approximately 13x the total interest rate exposure of TWO's MSR portfolio assuming it was unhedged, which UWMC knew full well it wasn't. UWMC's assertions that its now-terminated merger agreement with TWO was breached and that it has suffered damages is demonstrably false, and is consistent with its familiar refrain to blame others for its own shortcomings. As UWMC well knows, its stock-for-stock merger failed to secure shareholder support for several reasons, none of them having anything to do with TWO and starting with Mat Ishbia's disastrous fourth quarter earnings call on February 25, 2026. At the time of the scheduled March 2026 shareholder vote on the UWMC all stock transaction, UWMC stock had declined so much that the value to TWO shareholders was approximately 20% below its book value. Indeed, it would be $3.29 or 70% below book value, if valued as of last night's close. That, combined with skepticism about UWMC's governance practices, caused ISS to recommend against the TWO-UWMC transaction. Those concerns seem well-founded today. The lawsuit seeking damages from TWO also makes no sense. After termination of the TWO-UWMC merger agreement in March 2026, UWMC expressed relief at not transacting with TWO, calling it a "melting ice cube." And at last week's UWMC's earnings call just before UWMC's stock price cratered another 35%, Mr. Ishbia trumpeted that the Oaktree financing was better than any transaction with TWO, stating "the silver lining is Oaktree has so much better partnership for us than Two Harbors or anything else would have been. And so I think of it as a long-term upside for UWM the way it all played out..." Despite repeated opportunities to revise its proposal to make it competitive with CCM's all cash proposal, UWMC inexplicably failed to make any proposal that would address the publicly stated concerns of the TWO board. It now appears the reason UWMC was unable to do so was because of its undisclosed financial position. TWO looks forward to responding to UWMC's meritless and illogical lawsuit. If the action ever proceeds to the discovery stage, TWO is confident that communications between and among UWMC, Mizuho Bank and Oaktree, among others, will shed much-needed light on what truly was animating UWMC to publicly tout in repeated SEC filings - relied upon by all market participants - that UWMC had the intent, ability and financing to consummate a transaction with TWO, while failing for months to publicly disclose a $600 million derivatives loss."

Latest Data Shows REalloys Borrow Rate at 57.68%

Latest data shows the largest indicative borrow rate increases among liquid option names include: Direxion S&P Biotech Bear 3X (LABD) 27.30% +1.90, SpaceX (SPCX) 4.07% +1.87, Leverage Shares 2X Long SNDK Daily ETF (SNDG) 33.59% +1.49, Frmm Forum Markets, Incorporated (FRMM) 11.17% +0.77, Tradr 2X Long WDC Daily ETF (WDCX) 3.98% +0.37, UWM Holdings Corp (UWMC) 2.49% +0.31, REalloys Inc (ALOY) 57.68% +0.29, Banco Bradesco (BBD) 0.95% +0.26, DIREXION DAILY MSFT BULL 1.5X SHARES ETF (MSFU) 9.85% +0.24, and Monday.com (MNDY) 0.49% +0.22.

Major Averages Decline After Technology Earnings

The major averages were mostly lower after another round of technology earnings sparked renewed selling in software and semiconductor stocks.Economic data remains a central focus ahead of Friday's July employment report. Markets remain divided over the Federal Reserve's next policy move, with incoming employment data expected to play an important role in shaping expectations for interest rates over the coming months.Investors are also monitoring reports of progress toward a potential agreement involving Iran and shipping through the Strait of Hormuz, which has helped keep oil prices relatively contained even as uncertainty persists.Get caught up quickly on the top news and calls moving stocks with these five Top Five lists.1. STOCK NEWS:SanDiskreportedand revenue and provided an upbeat outlook for Q1Western Digitalreportedand provided upbeat Q1 earnings guidanceBlockreportedand provided guidance for Q3 and 2026Modernasaid the, a new vaccine against seasonal influenza, for use in all adults 50 years and olderWarner Bros. Discoveryreported2. WALL STREET CALLS:JPMorganCharles Riverto Overweight following "strong" Q2 reportGlobal Paymentsto Outperform at Wolfe ResearchZillow Groupat Bernstein and Evercore ISIAppLovinat Wells Fargo and Piper SandlerHubSpotby at least seven firms post the Q2 report3. AROUND THE WEB:China launched a formal security review of products sold in the country by Palo Alto Networks, Bloomberg saysGooglewill be facing a class action lawsuit in the U.K. over the alleged abuse of its dominant market position after an antitrust tribunal allowed the claim to go ahead, Bloomberg reportsEarlier this year, Netherlands approved of Tesla'sFull Self Driving, FSD, system and has encouraged its adoption across the EU, but the country's road regulator RDW won't tell the public why it concluded the system is safe or how it evaluated the technology, Reuters saysFederal prosecutors investigated claims that JPMorganexecutives ignored deficiencies in the company's antifraud program and improperly denied over $100M in reimbursements to customers whose funds were stolen, WSJ saysMeta'sMuse Spark 1.1 AI model accessed the internet during cybersecurity testing and breached the systems of another company, The Information reports4. MOVERS:Aspen Aerogelswas higher afterand providing guidance for Q3 and FY26Alkami Technology (ALKT) rose afterthe company has launched a formal sale process after receiving interestHonest Companyand Iovancegained afterThredUpfell afterand cutting its guidance for Q3 and FY26BillionToOneand UWM Holdingswere lower after5. EARNINGS/GUIDANCE:Ralph Lauren, with EPS and revenue beating consensusHertzShift4 Payments, provided guidance for Q3, and cut its outlook for FY26Fox Corp., with CEO Lachlan Murdoch calling fiscal 2026 "an exceptional year"Pelotonand provided guidance for both Q1 and FY27INDEXES:The Dow fell 464.02, or 0.85%, to 53,885.10, the Nasdaq lost 15.09, or 0.06%, to 26,348.35, and the S&P 500 declined 13.59, or 0.18%, to 7,709.96.