Wednesday, 18 February 2009

Utilities - no longer a pure defensive play


I recently suggested in my Daily Form Commentary that the utilities sector fund XLU, seemed vulnerable after breaking below a key moving average level and a key trendline. The Dow Jones Utilities was one of the worst performing indices yesterday with a 4.8% drop and underlines the fact that even traditional defensive plays are not working in a market which is lacking normal liquidity and the usual participation of institutional fund managers.

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