CNBC's Rebecca Jarvis - The Dow is staging a major rebound and the session up 21 points after falling as much as to 200 points early in trading. Scary news from Bear Stearns had many investors expecting big losses on Wall Street Nasdaq still did fall 36 points, S&P 500 lost 12 points.

Huge subprime losses forcing Bear Stearns to agree to buyout from rival JP Morgan for just USD 2/share and news came to surprise Wall Street even though the company shed about half of its value on Friday, after announcing what the company called is significant loss of liquidity.

Takeover Bear Stearn’s stock was down further 84% to close at USD 4.81/share. Here is some perspective it had traded at USD 171/share back at the start of 2007, so just over a little of a year ago.

All eyes are now focusing on Fed Chairman Ben Bernanke as the Federal Reserve gets set for Tuesday’s interest rate meeting in Washington, it is expected that Fed will cut rate to 2% to help ease current economic crisis.

Wall Street action:

• Dow rebounds, up 21 pts, Nasdaq loses 36 points and S&P 500 falls 12 pts
• Huge subprime losses force Bear Stearns to agree to a buyout by JPMorgan for $2/sh
• FOMC meet on interest rate today in Washington
• Expect Fed to cut rates to 2% to ease current economic crisis