Stockwatch

The week's winners
SVB up 18.2%
Windsor up 11.2%

The week's losers
Chaucer down 20%
Cox down 7.5%

Share prices are still swinging merrily in the Lloyd's sector as the hurly-burly scramble for capital continues apace.

They all need the money to shore up their underwriting and are coming up with increasingly inventive ways of arranging it.

But the problem is not restricted to the nimble little Lloyd's operators.

The danger of capital shortages at our biggest insurers has already been acknowledged on these pages.

Analysts at Morgan Stanley this week reported signs of CGNU having to rein back on selling particularly capital-hungry products.

The shortage isn't being helped by weak equity returns and Morgan Stanley also regards CGNU as heavily reliant on the equity markets.

Over at Royal & SunAlliance (R&SA), look behind the headline figures when it announces its first quarter results on Thursday.

The £240m sale of its fund management arm is a welcome, but painfully slow, start to its planned £800m capital raising programme.

There now have to be doubts over its ability to complete the programme by the end of the year without resorting to some sort of alternative - getting into bed with a reinsurer or going to the money markets, for example.

With analyst forecasts for first quarter operating profits covering a vast range between £137m and £207m, chief executive Bob Mendelsohn is going to have to hit the upper end to end fears that R&SA needs drastic surgery to cure its ills.

Its price-to-earnings (P/E) - a measure of performance calculated by dividing the earnings per share into their market price - last year was a terrible -74.1 when CGNU was at 12.8, AXA was on 33.8 and Allianz was on 39.5.

Morgan Stanley predicts R&SA's P/E ratio to improve to 10.7 this year, which would substantially close the gap on the others.

Despite insiders insisting that parts of the business have started to show signs of the long-awaited turnaround, investors may not be prepared to wait any longer.

Of course, such a view depends on investors taking a hard-nosed rational approach to what they do with their money.

Warren Buffett knows they don't always do that.

The Berkshire Hathaway chairman, fondly known as the Sage of Omaha, reportedly told shareholders at this year's annual general meeting how Wall Street falls for the crooked side of corporate America.

"Many of the crooks look like crooks. Wall Street loves them as long as they are pushing out securities," he said.

Of course, not all US investors are so short- sighted.

One senior market analyst said US capital was now flavour of the month at capital-hungry Lloyd's.

He said: "The US banks think it's a good time to invest here after all the Europeans have lost so much money.

"Of course the Japanese won't - they're not so stupid."