Shares of power producers rose and are close to the flat line for the year to date.
The SPDR Select Sector Utilities exchange-traded fund, which tracks the utilities industry group of the S&P 500, is down about 1.7% for the year to date. The sector is on one of the "worst performing, yet appears to have the most increase in earnings" in the coming quarter, said J.D. Joyce, president of Houston financial advisory Joyce Wealth Management.
"It seems as though there's higher demand anticipated for [electricity] over the coming years. But with rising rates, these companies are debt laden. They're not looking attractive with [Treasury] yields at these levels because people often invest in utilities for higher yield." The sector could become more attractive to fixed-income investors if Treasury yields continue to fall, the strategist said.
NuScale Power shares were recently up 30% after updates about a small modular nuclear reactor project in Romania and a Cannacord Genuity price target increase.
Write to Rob Curran at rob.curran@dowjones.com
(END) Dow Jones Newswires
03-18-24 1757ET
