U.S. insurers track fall in Treasury yields as recession fears weigh

Fednat Holding Co

23/06/2022 17:50

** Shares of major insurers track a fall in U.S. Treasury
yields in afternoon trade  US/ 
    ** S&P 500 Insurance Index  .SPXIN  loses ~1.2% 
    ** Travelers Companies Inc  TRV.N , MetLife Inc  MET.N ,
American International Group Inc  AIG.N  and Prudential
Financial Inc  PRU.N  fall between ~1% and ~2.5%
    ** Smaller peers Heritage Insurance Holdings  HRTG.N ,
FedNat Holding  FNHC.O  and Brighthouse Financial Inc  BHF.O 
drop between 3.7% and 5.1%
    ** U.S. Treasury yields fell to two-week lows on concerns
that the Federal Reserve will cause a recession by aggressively
hiking interest rates  urn:newsml:reuters.com:*:nL1N2YA137
    ** U.S. central bank chief Jerome Powell said on Thursday
that Fed's commitment to reining in 40-year-high inflation is
"unconditional" but also comes with the risk of higher
unemployment,  FED/   urn:newsml:reuters.com:*:nL1N2YA12E
    ** Insurers, who invest a large chunk of their income, take
a hit from a drop in yields as lower rates typically reduce
their profitability
    ** Yield on benchmark 10-year Treasury notes  US10YT=RR 
were at 3.111%; two-year  US2YT=RR  U.S. Treasury yield, which
typically moves in step with interest rate expectations, fell to
2.994%
    ** Shares in big banks also down on Thursday  urn:newsml:reuters.com:*:nL4N2Y92ZJ

 (Reporting by Manya Saini in Bengaluru)
 ((Manya.Saini@thomsonreuters.com;))