Running a comparison chart between ED and DUK shows the same pattern. I believe this to be due to the strong market for industrials. On the other hand, look at AEP. Could it be that the agreements with the fed to complete the PGN merger will affect future earnings negatively?
Agree with above comments. There has been sector rotation
from utilities into higher risk groups such as industrials since
QE3. DUK also seems to have been hurt by the shenanigans
in the boardroom at the time of the merger completion.
Hopefully this sell off will be temporary and long term income
investors should do OK (although I'm wary about any stock
Cramer likes as he seems to be a contrary indicator).
This looks like profit taking and sector rotation to me. Funds appear to be taking profits on year-long runups in stable high yield companies like utilities and tobacco and moving into home builders, industrial, and automotive manufacturers, among others. I'd expect the recent downward moves in stock price to slow/stop as effective yields move back above the 5% range.
I think once Qe3 runs its course and the dollar starts to strengthen again. The defensive plays drugs tobacco and utilities will be back in the spot light. Oil is down again today. Currencies are mixed and Europe is more of a disaster than US.