NU Stock Analyst
Whether the fiery crash of American Airlines Flight 587 was the work of terrorists or a tragic mechanical failure, the fact that this disaster hit on the heels of Sept. 11, and the nerve-wracking publicity generated will be harmful to the market performance of insurance stocks.
Only the brokers and a small number of other non-risk-taking companies appear well positioned to increase earnings in the period ahead.
October didnt live up to its reputation for market selloffs. There were no crashes, massacres, panics, wipeouts, or the like. Rather, October turned out to be a period of recovery for both the general market, and for this industry.
After three down months in a row, which featured a post-Sept. 11 general market meltdown, we almost made it back to even. For the record book, our list of stocks averaged a minimal decline of 0.5%. There were 60 advances and 57 declines. And for a change, not a single issue remained unchanged.
The brokers were best with an advance of 9.26%. Second best were the service companies with 7.12% escalation.
Our number three group was the financial services sector, which stabilized and then ended ahead 5.33% for the month. Six of the seven financial services stocks were gainers.
The reinsurers gained 4.34%, with six advances and six declines. Three double-digit winners gave a positive bias to the sector.