Market analysts believe conventional wisdom regarding the Federal Reserve and future rate rises could be contributing to this change of heart, but it is not the full story. The recent uptick in the 10-year Treasury note of one half a point in May has been the highest yield seen in over one year. [Low-Volatility ETF Cools as ‘Junk’ Stocks Soar]
“While defensive stocks outperformed cyclical stocks for much of early 2013 and the yield on the 10-year bond spent very little time north of 2%, utilities had become a favorite of yield seekers, who looked to the sector for their traditionally high dividends,” Witkowski wrote.
Utilities Select Sector SPDR
Tisha Guerrero contributed to this article.