Sector movers: Defensives find a bid amid light profit-taking
The more interest rate sensitive areas of the market benefited on Wednesday, as investors took some profits in cyclical names following the recent rise in government bond yields.
Stoking the advance in yields was recent more upbeat economic data and hopes for the start of a synchronised economic recovery across the G-20 starting from the second quarter.
Of key importance in that regard were expectations that accelerated vaccine rollouts and rising rates of natural immunity by people who had already been infected would begin to slow the pandemic over the next few months.
Indeed, for Jonathan Golub at Credit Suisse it was the resulting pick up in demand for capital that was driving yields higher.
In remarks to CNBC, Golub also noted how credit spreads were narrowing, as short-term worries about corporate defaults receded.
Be that as it may, Citi's Tobias Levkovich was less constructive, reportedly telling clients that the risk-reward on offer in US equities at least was now neutral.
Hence, said the Citi strategists, a 'correction' in stocks was increasingly likely.
Big Oil was also higher, with stock in BP and Shell on the up after the former's full-year results.
On the background meanwhile, front-dated Brent was 2.4% stronger to $64.89 a barrel on ICE.
Top performing sectors so far today
Fixed Line Telecommunications 1,569.03 +1.20%
Gas, Water & Multiutilities 4,822.23 +1.10%
Technology Hardware & Equipment 1,991.52 +1.00%
Pharmaceuticals & Biotechnology 15,694.41 +0.78%
Oil & Gas Producers 4,982.01 +0.67%
Bottom performing sectors so far today
Tobacco 28,087.57 -3.31%
Oil Equipment, Services & Distribution 5,422.94 -2.90%
Industrial Engineering 15,471.61 -2.19%
Construction & Materials 7,008.62 -2.08%
Financial Services 12,637.52 -2.04%