The Dow Jones Utility Average is nearly 30 percent higher than where it closed March 23. But since mid-April, utilities and essential services stocks have essentially run in place. In fact, most have given back a fair portion of their recovery, as increasingly excited investors have gravitated to traditional “growth” sectors.
Unless your only news source is CNBC, it’s hard to ignore the increasing dissonance between the US stock market’s resilience and the steady drumbeat of worsening global economic data. And even best in class essential services companies are feeling the pain, as Utility Report Card comments reveal.
I for one hope the bullish case pans out. That’s for unprecedented global fiscal and monetary stimulus to foster a relatively fast rebound for the global economy, and COVID-19 fallout to abate without much more damage.
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