Making Sense of Utility Stocks Performance During the Pandemic Market Rout
- Apr 1, 2020 4:04 pm GMT
In the stock market, utilities are a defensive sector. Investors put money into utility stocks to escape market volatility. For fans of regular income, utility companies also offer a steady stream of dividend payouts. Utility stocks were safe havens during the financial crisis of 2008. Investors poured funds into electric and water companies because they were safe bets against hemorrhaging markets.
But the script has gone awry during the current pandemic. After years of slow and steady growth, one that mirrored the more rambunctious bull run of the broader market, the S&P 500 Utility Sector also crashed and burned as markets screeched to a halt after a decade-long bull run. Investors scrambled to find a safe haven from the market’s gyrations. In slightly more than a month, the S&P 500 Utility index plunged by 36.5%. (It has clawed back some of that ground since, rising approximately 30% in the last week).
No discussions yet. Start a discussion below.
Get Published - Build a Following
The Energy Central Power Industry Network is based on one core idea - power industry professionals helping each other and advancing the industry by sharing and learning from each other.
If you have an experience or insight to share or have learned something from a conference or seminar, your peers and colleagues on Energy Central want to hear about it. It's also easy to share a link to an article you've liked or an industry resource that you think would be helpful.