Trade of the Day: Utilities SPDR ETF (NYSEARCA:XLU)

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Today, we’re opening a new bullish trade on the SPDR Utility ETF (XLU). The Fed minutes were released today (and along with a few statements from Fed members) the news seems to still be pointing towards a dovish outlook for 2016.

Low interest rates will probably be a good thing for stocks across the board — outside of financials — but it should be particularly good for utilities that have been lagging. We like a new position today on utilities in anticipation that low yield expectations, a falling dollar and some residual uncertainty will make these relatively high-yielding assets much more attractive in the short term. Currently, we are targeting the prior highs as the ETF bounces up from support.

Buy to open the XLU October 50 Calls (XLU161021C00050000).

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Article printed from InvestorPlace Media, https://investorplace.com/2016/08/trade-day-utilities-spdr-etf-nyse-xlu/.

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