Avery Schumer
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Avery Schumer in Sector Report,

Hard To Knock The Utilities Hustle

The Utilities SPDR (ETF)  fell almost 2.4 percent last week after Goldman Sachs downgraded the sector citing valuation concerns.

“With the utility sector index roughly 10% higher than YE 2016 levels and having outperformed the S& 500 by 1% (excluding dividends) and 2% (including dividends), we become bearish on valuation,” said Goldman Sachs analyst Michael Lapides in a note.

Goldman lowered its view on the utilities sector to Cautious from Neutral. Still, XLU, the largest utilities exchange traded fund by assets, is higher by about 7 percent year-to-date. That's an impressive performance when considering interest rates have been boosted twice by the Federal Reserve and no sector is as inversely correlated to rising Treasury yields as utilities.