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Data room: Share price movements

Bernanke adds to (re)insurance stock pressures

(Re)insurance stocks fell heavily last week after Federal Reserve chairman Ben Bernanke added to the short-term headwinds facing the sector with his threat to cut off the supply of cheap money to the economy.

Most US-listed (re)insurance carriers in our cohort underperformed the S&P 500's 2.1 percent fall for the week.

Bermudian (re)insurer Validus led the retreat, dropping 7.5 percent during the week to $33.85. This included a 4 percent decline on Friday (21 June) after a Credit Suisse note highlighted the competition property-cat focused reinsurers are facing from the insurance-linked securities market.

Credit Suisse analyst Michael Zaremski downgraded Validus from outperform to neutral as he suggested that fees from the reinsurer's "capital-light" third party investment business would not offset expectations of continued pressure on property cat rates over the next 12 months.

The share prices of property catastrophe-focused carriers have come under pressure in recent weeks as a result of pessimism over mid-year renewal rate reductions.

Large US commercial carriers, which are strongly correlated with the health of the US economy, were also among the most affected by macro concerns.

CNA, XL, Travelers, American International Group and Chubb all shed more than 3 percent for the week.

Some London stocks recover

After several weeks of poor performance, several London-listed carriers stopped the rot last week with share price climbs as investors eyed a buying opportunity on over selling.

The share prices of Catlin, Hiscox and Beazley all added more than 2 percent in the week. This comes against a backdrop of heavy selling pressure in broader equity markets, with the FTSE 100 index down 3.1 percent for the week.

Despite Catlin's strong performance last week, it remains one of the worst performing of its peers in Q2, down 5.9 percent for the period, as investors continue to maintain a bearish outlook on carriers that rely on catastrophe business for a large portion of their profits. Lancashire and Amlin have also been under pressure in the quarter, with their share prices down 6.4 percent and 10.7 percent respectively.

European stocks also suffer

European (re)insurance carriers also felt the pain last week amid a choppy market.

Global macro concerns helped stack on the pain to a sector that has already suffered heavy stock price declines in recent weeks as investors nervously eye flood losses in Central and Eastern Europe.

Catastrophe modeller AIR was the first of the big three agencies to put a number on the European flood losses last week. The agency surprised some with a larger-than-expected EUR5.8bn estimate for insured losses from Germany alone.

This is above the circa EUR3bn figure cited by most market watchers as a rough proxy for the entire event in the early days of the floods. Germany-based Allianz, Europe's largest insurer by market capitalisation, fell 6.5 percent for the week to EUR106.75. The decline extended its June retreat to more than 11 percent.

Spanish (re)insurer Mapfre, often a significant mover when investors' fears over the economy surface, also lost more than 6 percent in the week to close at EUR2.52.

Italy-based Generali and global insurer Zurich are also among the biggest losers in June, down more than 7 percent each.

Brokers weaken as economic clouds gather

The share prices of insurance brokers mostly declined last week as investors contemplated the prospect of the Federal Reserve withdrawing its life support for the world's largest economy.

US-focused retail brokers Brown & Brown both lost more than 2.65 percent. Global broking giant Aon also lost more than 2.5 percent.

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