Utilities exchange traded funds plunged over the past two weeks in back-to-back selling, with the sector experiencing its longest rout in 14 years, as traders dumped the bond-esque asset on rising expectations of a Federal Reserve interest rate hike.
Since September 22, the Utilities Select Sector SPDR (NYSEArca: XLU) fell 7.4%, Vanguard Utilities ETF (NYSEArca: VPU) fell 7.3% and First Trust Utilities AlphaDEX Fund (NYSEArca: FXU) decreased 5.5%. XLU and VPU are also now trading below their 50- and 200-day simple moving averages. The utilities sector, though, remains one of the better performing areas of the market, with XLU up 11.7%, VPU up 12.3% and FXU up 14.8% year-to-date.
The S&P 500 utilities sector closed in the red for the ninth consecutive day on Wednesday, losing close to 7.8% over the period, compared to the 1.1% dip in the broader market, reports Adam Samson for the Financial Times.