The Hartford Financial Services Group on Tuesday posted a much narrower loss for the third quarter, as its investment losses shrank as financial markets improved.

The insurance and financial services firm based in Hartford, Conn., lost $220 million, or 79 cents per share, in the latest period. Core earnings, which exclude certain investment gains and losses, totaled $660 million, or $1.56 per share.

Last year, the company lost $2.63 billion, or $8.74 per share, battered by the market plunge and claims from Hurricane Ike. The adjusted loss last year was $1.40 per share.

Analysts polled by Thomson Reuters, on average, expected The Hartford to post core profit of $1.11 per share. Analyst estimates tend to exclude one-time, unusual items.

The company also lifted its full-year profit outlook.

In after hours trading, Hartford shares gained $1.20, or 5.3 percent, to $27.50. Before the third-quarter report, the stock closed Tuesday's regular session at $25.82.

The Hartford's new Chairman and CEO Liam McGee, said the results show the company is "emerging from the challenges of the last 18 months."

While the potential remains for another downturn in the economy as well as in the equity and credit markets, McGee, who took the helm a month ago, said the company's insurance and investment businesses are stable and "we are seeing signs that business momentum is building."

The Hartford's results benefited from a $63 million after-tax gain related to the revision of its estimates of future gross profits in its life insurance operations.

The Hartford's net realized capital loss narrowed by about 60 percent to $885 million, after tax, in the third quarter, compared with $2.2 billion in the same period of 2008. Continued...