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[marketmaven]

CROOK NEWS: AIG shares hit insurance index
Ameritrade upgrade, Schwab trading data lift brokers
By Greg Morcroft, MarketWatch
Last Update: 10:05 AM ET Feb. 14, 2005

NEW YORK (MarketWatch) - Shares of insurance giant American International Group fell early Monday after the firm surprised the market with word of new questions from regulators about some of its businesses. The drop helped drive down the S&P Insurance Index 0.8 percent in early trade, and also dragged on the Dow Jones Industrial Average.

In the broader financial sector, the Amex Securities Broker/Dealer Index ($XBD: news, chart, profile) added 0.2 percent, while the Philadelphia Bank Sector Index ($BKX: news, chart, profile) added 0.1 percent

AIG shares (AIG: news, chart, profile) were off $1.10 at $72.02 in morning trade. Early Monday, AIG said it received subpoenas from regulators seeking information on its non-traditional insurance products and reinsurance transactions. See full story. Last week, AIG shares rose more than 8 percent amid an earnings report that was generally well received by analysts, and the impression most regulatory issues were being resolved in an orderly fashion. Among movers in the banking sector, Wachovia (WB: news, chart, profile) shares fell 1.2 percent to $55.35 following a pair of downgrades Monday.

Banc of America Securities and UBS both downgraded Wachovia shares to "neutral" from "buy," saying the shares trade at a premium to rivals after recent gains. Online brokers were among the big gainers in the brokerage sector. Ameritrade (AMTD: news, chart, profile) shares rose 1.2 percent to $11.66, aided by an upgrade from Banc of America Securities. "The outlook for consolidation, which we view as more likely given increased price pressures and weaker fundamentals for online retail trades, will likely keep a floor under the stock," the B of A analysts said.

Charles Schwab (SCH: news, chart, profile) shares rose 1.7 percent to $10.95 after it reported client trading in January held mostly steady with December levels, and was stable so far in February.