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# The safest corner of the American market was the worst place to be last week
- URL: https://www.sharespective.com/stories/safest-corner-american-market-worst-place-2026-09-28/
- Published: 2026-09-27T21:15:02.000Z
- Updated: 2026-10-19T19:28:07.000Z
- Description: Utilities were the weakest of the eleven S&P 500 sectors last week. The Utilities Select Sector SPDR Fund, which holds the big American power companies, closed Friday at US$39.45, its lowest since April 2025 and close to 20% below this year's peak.
- Author: Shaun Botha
- Tags: Utilities, #story, #group-energy

Utilities were the weakest of the eleven S&P 500 sectors last week. The Utilities Select Sector SPDR Fund, which holds the big American power companies, closed Friday at US$39.45, its lowest since April 2025 and close to 20% below this year's peak.

**A power company competes with a government bond.** Regulated utilities borrow heavily to build, and hand most of what they earn back as dividends. Both are priced off long bond yields. The US 10-year Treasury finished Friday at 5.18%, its highest since 2007.

A Treasury pays that with no operating risk attached. The average American power company pays less, and has to run a grid to do it. Money that came for the dividend leaves when the risk-free rate passes it.

The odd part is that demand has never looked better. Data centre construction is adding electricity load across the country, and NextEra Energy, Southern Company and Duke Energy are about 28% of the fund. None of it helped.

What to watch 

Wednesday's August PCE price index in New York. Our read is that nothing about these businesses changed last week. Their dividends stopped looking generous next to a government bond, and that reverses when yields do.

[ This story ran in The Narrow Climb Monday 28 September’s edition, with the market snapshot, the other two stories, the numbers and the week ahead. Read the whole edition → ](https://www.sharespective.com/sharespective-2026-09-28/)