Telecommunication companies are trying to dial into a share of the Federal stimulus package in hopes of gaining some of the broadband funds that Washington is proposing, and affecting related investments and exchange traded funds (ETFs).

The recent market rally, which sparked the interest of many an investor, took iShares Dow Jones U.S. Telecom (IYZ) up more than 6% and has renewed interest in this sector. Telecommunication firms such as AT&T (T) and Verizon (VZ) are up for around $4.7 billion in Federal funding and are part of the larger picture when Washington is speaking of broadband efforts, says Don Dion for Seeking Alpha.

Telecom companies argue that the restrictions placed on their services through network neutrality stifle development and draw the focus away from the original purpose of the stimulus. Together, AT&T and Verizon make up 21% of the ETF IYZ, making the company news important to investors of this fund.

Both AT&T and Verizon have been exploring “smart metering” to help customers increase energy efficiency. While the new energy meters are still in the early phases, “green” initiatives from both companies could draw interested buyers as pressure builds for the development of energy-efficient technology. $565 million was proposed to be spent by AT&T in the company’s green efforts.

  • iShares Dow Jones U.S. Telecom (IYZ): down 5.2% year-to-date

The opinions and forecasts expressed herein are solely those of Tom Lydon, and may not actually come to pass. Information on this site should not be used or construed as an offer to sell, a solicitation of an offer to buy, or a recommendation for any product.