LIVE MARKETS-From Dull to Dynamo: Utilities' surprising glow-up in today's market

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FROM DULL TO DYNAMO: UTILITIES' SURPRISING GLOW-UP IN TODAY'S MARKET

As macro uncertainty intensifies, U.S. utilities are emerging as a defensive darling, offering a relatively low-risk refuge.

Insulated from sales volume shocks and tariff risks, utilities benefit from lower interest rates, making them a compelling safe haven in turbulent times.

Utilities .SPLRCU currently trade at a discount to the S&P 500 .SPX, offering a rare value opportunity in a defensive sector, says Jefferies.

What makes certain utilities particularly appealing? Look for companies with "decoupling" mechanisms that insulate them from sales volume fluctuations, manageable regulatory exposure, and limited need for external equity, says Jefferies.

The recent drop in Treasury yields to 4.0% (from 4.6% at year-end 2024) provides an additional tailwind for the sector.

Standout defensive plays include Exelon EXC.O, Consolidated Edison ED.N, ONE Gas OGS.N, Duke Energy DUK.N, and American Water Works AWK.N, which offer lower risk profiles without major project complications facing some of their peers.

While tariff concerns loom over much of the market, utilities remain relatively protected, with flexibility to adjust capital expenditures while maintaining rate base growth.

For investors seeking shelter from market storms, utilities offer that rare combination of relative value, reduced volatility, and defensive positioning when uncertainty reigns.

(Rashika Singh)

FOR MONDAY'S EARLIER LIVE MARKETS POSTS:

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WATCH THOSE RETAIL FLOWS - CLICK HERE

SELL EVERYTHING! - CLICK HERE

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TARIFF MEDICINE'S CRIPPLING SIDE EFFECTS - CLICK HERE