Dividend-News

REITs And Utilities Dive As Yields Jump

Published Sat, 09 Nov 2019 12:51:35 -0500 on Seeking Alpha

Real Estate Weekly Outlook
Reports that the US and China may be finally nearing an agreement on the long-awaited "Phase 1" of a trade deal propelled US equity markets to new all-time record highs, but also sent US Treasury yields surging to the highest levels since late July, with the 10-year yield jumping 20 basis points to close at 1.93%. With earnings season winding down and on a slow week of economic data, back-and-forth trade headlines dictated near-term sentiment as investors shunned the long-outperforming defensive and yield-sensitive equity sectors in favor of this year's relative laggards including the more economically-sensitive energy, financials, and materials sectors.

(Co-Produced with Brad Thomas through iREIT on Alpha)
Waning worries on the trajectory of global economic growth sent the SPDR S&P 500 ETF (SPY) higher by 0.9% while the Nasdaq ETF (QQQ) gained 1.2%. Rates up, REITs down? The paradigm that bedeviled real estate investors for much of the past three years showed hints of an unwelcome return this week. The broad-based Real Estate ETF (VNQ) dipped 3.3%, delivering its worst week since December 2018 and giving up its YTD outperformance relative to the major equity indexes. After breaching record highs in late October, REITs are lower by an average of 5% despite concluding a generally better-than-expected earnings season with more than half of the sector boosting guidance.

The Hoya Capital US Housing Index, the benchmark that... Read more