Don't let it get away!
Keep track of the stocks that matter to you.
Help yourself with the Fool's FREE and easy new watchlist service today.
Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.
What: Shares of life insurance stocks MetLife (NYSE: MET ) , Manulife (NYSE: MFC ) , and ING U.S. (NYSE: VOYA ) all sank more than 3% today on the Federal Reserve's decision not to cut back on its $85 billion-a-month bond purchases.
So what: The life insurance sector has soared over the past year on a steadily steepening yield curve, but the no-taper move is forcing Mr. Market to sober up a bit. After all, life insurers invest the premiums collected from customers until they have to pay them out in claims, so the Fed's decision suggests the group will be earning much lower interest for longer than Wall Street had expected.
Now what: Don't assume that tapering will just sync up over the next few months and that life insurers will follow. "We could begin later this year. But even if we do that, the subsequent steps will be dependent on continued progress in the economy," Fed Chairman Ben Bernanke said. "We don't have a fixed calendar schedule. But we do have the same basic framework that I described in June." Of course, for conservative Fools with a bit of patience, today's sector pullback might be providing an opportunity to pick up a few well-capitalized and relatively diversified insurers for the long haul.
A more fabulous financial find
Have you missed out on the massive gains in bank stocks over the past few years? There's good news: It's not too late. Bargains of a lifetime are still available, but you need to know where to look. The Motley Fool's new report "Finding the Next Bank Stock Home Run" will show you how and where to find these deals. It's completely free -- click here to get started.