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Utilities maintain modest gains after Fed rate cut

|About: Utilities Select Sector SPD... (XLU)|By:, SA News Editor

The utilities sector (XLU +0.4%) trades in positive territory following the Fed's move to lower interest rates by 25 bps, as expected.

Investors already are "fairly starved for yield, so another reduction in interest rates could lead to more money flowing into the sector known for fat dividends," writes MarketWatch's Teresa Rivas.

Meanwhile, U.S. Treasury yields are lower across the curve, gathering some added interest from speculation that action in the overnight repo market has increased the potential for the Fed to restart asset purchases to provide more liquidity and help keep the overnight repo rate in check.

Most major utility names trade higher, including PCG +4.4%, PNW +1.5%, EXC +1.3%, D +1.2%, AEE +1%, PEG +0.7%, NEE +0.7%.

ETFs: XLU, UTG, VPU, GUT, BUI, FUTY, IDU, RYU, FXU, UPW, SDP, JHMU, FUGAX

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