NEW YORK (Bloomberg) — MBIA Inc. and Ambac Financial Group Inc., the two largest bond insurers, surged to their highest levels in almost 11 months on Tuesday.

MBIA rose $1.48, or 22 percent to $8.24 as of 4.15 p.m. in New York Stock Exchange composite trading. Ambac climbed 23 cents, or 14 percent, to $1.88. The last time either company's shares traded that high was last November.

"It looks like a momentum trade," said Jim Ryan, an analyst with Morningstar Inc. in Chicago. "People are looking to buy something on the view that things are going to get better."

MBIA and Ambac lost the top ratings that were the basis of their insurance businesses after reporting billions of dollars in losses on mortgage-linked securities.

Armonk, New York-based MBIA says it plans to return to the business of insuring municipal bonds through a newly-created public finance insurer. Ambac of New York delayed plans to create a municipal-only insurer after failing to find investors in the venture.