bullish
Sector Rotation Amid Anticipated Fed Rate Cuts: Utilities Vs. Financials
213 Views13 Aug 2024 20:17
SUMMARY
- XLF Decline Post Rate Cuts: The Financials Select Sector ETF (XLF) declined by an average of 5.6% in the six months following the last three monetary policy pivots.
- Credit Delinquency Risks: Rising credit card delinquencies, now at 10.93% for severe cases, pose a significant risk to financial firms within XLF, potentially amplifying their underperformance as rates decline.
- Utilities Sector Advantage: Utility companies tend to outperform during rate cuts due to reduced debt payments, with the sector seeing a ~6% spread increase compared to the S&P 500.
Begin exploring Smartkarma's AI-augmented investing intelligence platform with a complimentary Preview Pass to:
- Unlock research summaries
- Follow top, independent analysts
- Receive personalised alerts
- Access Analytics, Events and more
Join 55,000+ investors, including top global asset managers overseeing $13+ trillion.
Upgrade later to our paid plans for full-access.
or
Already have an account? Sign In Now
Discussions
(Paid Plans Only)
Top Quartile
Mint Finance
Deep Fundamental Analysis
- Sector Rotation Amid Anticipated Fed Rate Cuts: Utilities Vs. Financials13 Aug 2024
- Navigating Frothy US Equities with S&P Spreads03 Jul 2024
- Goldman Sachs Positioned to Outperform in 2024 with Strong Tailwinds (Part 1)26 Jan 2024
- Next Era Energy: Investments into Clean & Green Energy, and the IRA, to Drive Outperformance01 Sep 2023
x