- Utilities are today's worst performers in the S&P 500, with the Utilities SPDR ETF (XLU -2.1%) falling as much as 3.4% intraday to the lowest since December 2016.
- Williams Capital analyst Chris Ellinghaus says the firm urges utility investors to remain cautious through late winter as the sector faces headwinds including valuations, a rising interest rate cycle and potential inflationary pressures amid what’s likely to be the "final leg in a bear market."
- Ellinghaus expects a further 7%-9% drop in utility stock prices before valuations look much more attractive in early spring.
- Top utilities are all trading lower: DTE -3.5%, PEG -3.5%, NEE -3.3%, AEE -3%, EXC -2.6%, AEP -2.6%, DUK -2.5%, PCG -2.4%, WEC -2.2%, SRE -2.1%, PPL -1.9%, SCG -1.6%, D -1.3%, SO -1%, EIX -0.9%.
- ETFs: XLU, UTG, VPU, GUT, IDU, BUI, FUTY, RYU, UPW, PSCU, FXU, SDP, PUI, FUGAX, JHMU, BUYN, UTLF, XU
- Source: Bloomberg First Word
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Original article