Fannie Mae Shares Jump 17%

Fannie Mae (NYSE:FNM) shares are off to the races today, up 17% trading at $1.23 a share all thanks to the U.S. Treasury willing to cover any loss for the next three years.

Volume on Fannie shares is screaming, as of 12:30 EST PM 92.7 million shares have traded hands, compare that to the normal daily average of 26.7 million. 

Last Thursday, the Treasury Department announced that it had amended its programs of support for the two mortgage funding companies, eliminating a cap of $200 billion in capital funding for each until the end of 2012.

In making the announcement, Treasury said that neither firm was near their $200 billion limit — through the third quarter $51 billion had been provided to Freddie Mac and $60 billion to Fannie Mae — and it hoped that the elimination of any cap would, “leave no uncertainty about the Treasury's commitment to support these firms as they continue to play a vital role in the housing market during this current crisis.”

Fannie $1.50 Calls are moving today, here's a look at the action:

Expires Symbol Last Chg Bid Ask Vol Open Int Jan 10 NJWAG.X 0.05 0.00 N/A 0.05 1,729 3,954 Mar 10 NJWCG.X 0.10 0.00 0.10 0.15 2,335 5,919 Jun 10 NJWFG.X 0.20 0.10 0.15 0.20 644 2,766