Income Issues Spanked by Higher Interest Rates

The 10 year treasury moved up a measly 7 basis points today which was enough to give a sound spanking to REITS and utilities.

Utilities moved lower by 1% today,  with water utility Artesian Resources (NASDAQ:ARTNA) being the largest utility loser losing over 6%.  Many other issues fell by 2-3%.

REITs took a severe shellacking with the average share falling by 1.5% with many individual issues falling by 2-3%.  No particular sector was spared losses, but as we have come to expect the retail REITS took some of the largest losses.

1 of our favorite apartments REITS, Independence Realty Trust (NYSE:IRT) took a 3% loss today.  We had sold our shares a few weeks ago locking down a nice capital gain, but if IRT was to sustain further losses in the days ahead we might be repurchasing shares.

While the average preferred stock sustained a loss of a couple of pennies today a few issues took outsized losses.  GasLog 8.75% preferred (NYSE:GLOG-A) fell 64 cents after announcing a new preferred offering.  Hersha Hospitality preferred HT-D and HT-E fell by 72 and 63 cents respectively.

We would encourage investors to take todays losses in stride as it is highly likely share prices of income issues will reverse course on Wednesday.


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