Dow Turns Down as Insurance Sector Rally Wears Off
The Dow Jones Industrial Average is taking a downward turn today as excitement over an insurance sector rally wears off. Insurers had been rallying on the news that TARP funds would be made available to them. CNN Money reports on the eligibility required for insurance companies to be considered for the government capital:
To be eligible for the program, insurers either had to already own a lender or acquire one, and apply by a November deadline.
Life insurers, which together hold trillions of dollars in investments, have been particularly susceptible to the financial crisis, and for that reason may have been cleared for financial assistance.
The sector has been broadly hurt in recent months by weaker financial markets that caused investment losses and higher costs for annuity products that are affected when market values fall.
However, some of the insurers are already expressing disinterest in taking the money. The conditions imposed on the big banks accepting TARP funds has been a discouragement. Many of the companies say that they are in reasonably good shape right now, and might not need the money.
At any rate, after a morning spent in flux, including time spent in positive territory, the stock market is now lower. The Dow, Nasdaq and S&P 500 are all down right now (although the Nasdaq is down by less than 2 points). Clearly some of the optimism is wearing off as investors begin to focus on other things.
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