NU Stock Analyst

Considering what the markets have done in the last few weeks, it is almost a relief to look back to June, although ordinarily the activity in that month would be nothing to write home about.

Indeed, June 2002 was also a month of a sell-off in the general market, which left investors biting their fingernails and dumping stocks. There were awesome displays of panic selling, spiced with a number of short but memorable rallies.

For the record, in June the Dow Jones Industrial Average ended down 6.87%, the S&P 500 was off 7.24%, and the tech-heavy NASDAQ plunged 9.33%.

Insurance stocks could not avoid being caught in the June swoon in the general market. But they made a good try. The 114 stocks priced here recorded a loss of 3.49% for the month. Unlike the general market, which went from bad to worse in June, our specialty had a few more advancers than in that ugly month of May.

Perhaps the best that can be said for insurance stocks in June is that they outperformed the general market!

All of the groups ended in the minus column. But two sectors–the brokers and the specialists–were off less than 1%. The rest made a mixed showing.

The life stocks were down a modest 1.23%. The property-casualty stocks declined 3.95%. The reinsurers fell 4.97%. The multi-lines and the financial services stocks were each down 5.61%. Our smallest sector, the service companies, took an 11.73% hit.

There was a scarcity of individual issues to get excited about. But there were a few, all of them the stocks of smaller companies.

In the life and health group, Citizens of Austin stood out with a stunning 44.22% surge to $12.98, from $9. This price explosion was the second since earlier this year. I dont believe there is an impending takeover bid about to be unfurled. Rather, the company has been prowling the hustings with stockholder information, which has stimulated interest in the stock. Investors have liked what they have heard.

UICI, the health insurer from Dallas, generated a good advance in a bad month. The stock has been subject to periodic surges and retreats. This latest 14.38% spurt to $20.20 was at least another good surge. Im listening and hearing nothing.

The first half of the year is now history. It has been a turbulent time in financial markets, which has generated the worst performance for the major averages since the early 1970s. And we havent even yet reckoned with July!

Thomas K. Meakin is affiliated with LIM Systems International in Voorhees, N.J. Stock results are supplied by The Firemark Group in Morristown, N.J.


Reproduced from National Underwriter Life & Health/Financial Services Edition, August 5, 2002. Copyright 2002 by The National Underwriter Company in the serial publication. All rights reserved.Copyright in this article as an independent work may be held by the author.