Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.

What: MBIA (NYSE: MBI) shares jumped 10% in intraday trading along with the mortgage insurance sector as investors speculate they will be able to put-back private mortgage insurance claims on big banks.

So What: Attorneys general in all 50 states have agreed to investigate whether banks and other lenders used illegal documentation on foreclosed properties. Traders moving the market today think this will give mortgage insurers leverage to put-back the claims against them on big banks.

Now What: Today's news has driven the entire sector higher and MBIA is just riding the wave. This could be part of a longer move up if it turns out banks have been acting illegally in the foreclosure wave over the last few years. Proving illegal bank activity on a large scale still has a long road ahead and I expect volatility in mortgage insurers in the short term, so until we know more this Fool is staying on the sidelines.

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Fool contributor Travis Hoium does not have a position in any company mentioned. You can follow Travis on Twitter at @FlushDrawFool, check out his personal stock holdings, or follow his Motley Fool CAPS picks at TMFFlushDraw. Try any of our Foolish newsletter services free for 30 days. True to its name, The Motley Fool is made up of a motley assortment of writers and analysts, each with a unique perspective; sometimes we agree, sometimes we disagree, but we all believe in the power of learning from each other through our Foolish community. The Motley Fool has a disclosure policy.