** Rate-sensitive real estate investment trusts (REITs) and utility firms slump on Weds after hotter-than-expected inflation data sends benchmark yields higher
** U.S. Treasury 10-year yield jumps to 4.5%, highest since Nov, and two-year yields rise to around 4.9% after U.S. consumer prices increased more than expected in March
** Higher rates make dividend-paying stocks, also known as bond proxies, like REITs and utilities less attractive, and drive up borrowing costs
** S&P 500 real estate index recently down 4% to about 2-mth low and on course for largest one-day pct drop since June 2022
** Biggest SPLRCR pct losers on Weds include Extra Space Storage and Public Storage both off 6%, and telecom tower co SBA Communications and office REIT Boston Properties both down ~5%
** S&P Utilities sector last down 1.8% on the session
** Biggest drags on SPLRCU are Nextera Energy and Duke Energy both off ~2%
** SPLRCR is the only major S&P sector in the red YTD, now down 6%. SPLRCU is up 2% this year including move on Weds
** S&P 500 index losing 1% on Weds, trimming 2024 gain to ~8%
(Lance Tupper is a Reuters market analyst. The views expressed are his own)
((lance.tupper@thomsonreuters.com lance.tupper@tr.com 1-646-279-6380))
Comments