As the market holds on to much of its early gains ahead of this afternoon's US jobs figure, insurers are in demand following a series of broker upgrades for the sector.
Standard Life shares have climbed 7.4p to 238.2p as Investec issued a buy note ahead of its results next week and raised its price target from 254p to 262p. Investec said:
Since its IPO in 2006, Standard Life has followed a different path to most of its UK competitors by moving away from writing risk business. Instead it has focused on selling fund management-driven products based on proprietary IT platforms.
In 2006 the company also decided to abandon paying up-front commission to intermediaries and this seems likely to place it in a very strong position in the post RDR (retail distribution review) world which will begin at the end of 2012. RDR will ban insurers from paying commission to intermediaries and we think the change needed in both business processes and products has probably been underestimated by at least some of Standard Life's competitors.
[Standard's] focus on selling wealth accumulation products in a recession may account for the shares trading significantly below the first half 2010 stated embedded value of 302p. This seems unduly harsh to us.
Aviva
Meanwhile has added 11.6p to 468.8p as Nomura issued a buy note following Thursday's figures and Credit Suisse raised its target price from 518p to 550p.
The rise in the two insurers has helped lift the FTSE 100 22.46 points to 6027.55.
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