Tags: barron’s | utilities | stocks | market

Barron's:  Utilities Stocks Don't Flicker in Market's Power Failure

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By    |   Monday, 25 March 2019 09:37 AM

It could be a good time to own some utility stocks, despite signs of a power failure in the recent bull stock market.

Utility stocks seemed to shrug off the market dip late last year. Barron’s reported that including dividends, the Utilities Select Sector SPDR ETF (ticker: XLU) had a total return of 21.2% for the 12 months ended on Thursday, according to Bloomberg data. Meanwhile, the SPDR S&P 500 ETF (SPY) returned only 7.3%, including dividends.

That strength is likely to continue, Barron’s quoted Maxwell Grinacoff from Macro Risk Advisors, as saying, because the Federal Reserve reiterated its dovish monetary-policy stance following its latest meeting, indicating that it isn’t likely to increase interest rates until at least the end of the year.

“Lower rates for longer would be good for bond-like stocks such as utilities. Typically, lower bond yields indicate a weakening of economic growth, which makes defensive sectors with stable dividend income—such as utilities—more attractive than cyclical ones as investors seek protection against losses,” Barron’s reported.

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It could be a good time to own some utility stocks, despite signs of a power failure in the recent bull stock market.
barron’s, utilities, stocks, market
168
2019-37-25
Monday, 25 March 2019 09:37 AM
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