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Utilities sector the only 1 of 11 S&P 500 sectors to lose ground as Treasury yields bounce

Tomi Kilgore

Shares of utility companies were broadly lower Wednesday, with the sector the only one of the S&P 500's 11 sectors to lose ground, weighed down by a big bounce in Treasury yields. The SPDR Utilities Select Sector ETF shed 1.0% in afternoon trade, with 27 of 28 equity components losing ground. The biggest decliner was NRG Energy Inc.'s stock which slumped 5.1%. Among other more active utilities ETF components, shares of AES Corp. lost 2.3%, Excelon Corp. gave up 0.9% and Southern Co. shed 0.6%. The lone gainer was Sempra Energy's stock which tacked on 0.6%. Meanwhile, the yield on the 10-year Treasury note rose 3.6 basis points to 2.484%, after falling 10.4 basis points the previous three sessions, as a bounce in the stock market helped calm risk-off trades. Utilities stocks tend to have relatively high dividend yields, so a rise in yields on low-risk Treasurys make them less attractive. The utilities ETF's dividend yield is 3.15%, compared with the implied yield for the S&P 500 of 1.99%, according to FactSet.