American Water Works Invests to Improve Distribution Systems
The utilities sector rallied higher this week due to the Fed’s decision to raise the interest rate. However, the sector pulled back on Thursday. The S&P 500 utilities sector fell 1.1% on March 16 and led the market decline.
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Indiana American Water invests $57 million
DTE Energy (DTE), American Water Works (AWK), and Centerpoint Energy (CNP) were the top losers in the utilities sector. American Water Works, one of the largest water utility companies in the US and Canada, fell 1.9% on Thursday. On March 16, Indiana American Water said that it will replace aging water pipes stretched for 41 miles and repair the water tanks that serve Indiana. Indiana American Water is a subsidiary of American Water Works. As a part of its plan to improve distribution systems, it invested more than $57 million.
US water infrastructure
Deborah Dewey, the president of Indiana American Water, called for a need to restructure the deteriorating water infrastructure in the US. According to research by American Water Works Association, the outdated water infrastructure in the US requires a minimum investment of $1 trillion in the next 25 years. In Indiana, an investment of more than $2.3 billion is required to keep up with infrastructural needs in the state. In addition to this investment, an annual maintenance of $815 million is estimated. On Thursday, American Water Works fell 1.9% to $75.74—the lowest close in a week.
Read How Implied Volatility, Short Interest Are Affecting Utilities to understand how implied volatility and short interest impact utility stocks. In the next part, we’ll discuss how stocks related to healthcare performed on Thursday. We’ll also discuss how the sell-off in the healthcare sector impacted markets.