Sector movers: Insurers prop up the Footsie

8th Oct 2014 17:05

The insurance sector led the way higher on Wednesday, led by gains in Prudential and Legal & General.Insurers' share prices got a boost from a positive research note on the global insurance sector from Citi analysts.The broker estimates that free-cash-flow yields for global insurers in 2015 are in the vicinity of 7%, versus the estimated global equity market average of approximately 5%.In the past there may have been good reasons for the market to place a lower multiple on those cash flows due to a combination of factors, including opacity, volatility, balance sheet concerns. However, some of those same elements are now disappearing, Citi said.The above is particularly true for global life and Europe, Citi wrote."Our forecasts for free cash generation from global insurers support a generally positive view on the sector, especially on the life insurance names, where profit drivers are more opaque, and European insurers."Tesco also outperformed today, lending its support to food retailers.Analysts at HSBC provided a lift after upgrading the stock from 'neutral' to 'overweight'. The bank said that much of the recent bad news has already been discounted in the stock price.In parallel, the Times reported that some of the grocer's leading investors have signalled their willingness to support a between £1bn-£2bn rights issue.Top performing sectors so far todayLife Insurance 7,166.91 +0.98%Electricity 9,626.23 +0.71%Personal Goods 23,607.42 +0.63%Tobacco 39,769.60 +0.60%Food & Drug Retailers 2,569.24 +0.58%Bottom performing sectors so far todayAutomobiles & Parts 6,890.28 -3.50%Chemicals 9,295.95 -2.30%Construction & Materials 3,618.59 -2.19%Electronic & Electrical Equipment 3,423.33 -1.97%Industrial Metals & Mining 1,287.06 -1.62%