Utilities stocks follow the broader market
After rising marginally during the previous week, the Utilities Select Sector SPDR ETF (XLU) dropped 1.3% during the week ending April 17. The drop came in spite of the drop in Treasury yields across maturities. Utility stocks, especially the highly leveraged ones, are very sensitive to interest rates.
While the drop in Treasury yields signaled diminished interest rate worries, the broader market dropped. The SPDR S&P 500 ETF Trust (SPY) represents the broader market—it dropped 1%. SPY is a key ETF that tracks the S&P 500 benchmark index. The iShares Core S&P 500 (IVV) also tracks the S&P 500. Out of 41 utilities stocks in our list, only eight advanced and 33 dropped during the week.
Edison International (EIX) was the biggest loser among electrical utilities during the week ending April 17. The stock dropped 4.3% to end the week at $61.07 with a market capitalization of $20 billion. Edison International is the holding company of Southern California Edison. During the last week, analysts at Argus Research lowered the price target on Edison International to $72 from $75 while maintaining a “buy” rating.
PNM Resources was one of the top losers during the week ending April 10. It had extended losses during the week ending April 17. The stock lost 3.4% to end the week at $27.63 with a market capitalization of $2.2 billion.
FirstEnergy (FE) lost 3.3% to end the week at $35.07 with a market capitalization of $14.8 billion.
Westar Energy (WR) lost 2.5% to end the week at $37.73 with a market capitalization of $5 billion.
Correction: Due to a copy editing error, when this article was originally published, the title indicated that three utilities dropped. The correct number is 33. We have updated the title. We regret the error.