Utilities stocks are on a tear this month as investors seek steady assets amid market volatility. The Dow Jones Utility Average hit a fresh intraday all-time high Wednesday. The index is up about 10% this month, on pace for its best monthly performance since March 2021. Utility stocks are often thought of as safe, defensive investments that generally see steady returns even as the rest of the market is choppy. "Being Defensive, by and large, has worked," Fundstrat's Mark Newton said in a note Tuesday, naming utilities as "standouts." These companies typically have outsize dividends that provide investors with a dependable income during choppy market periods. And with interest rates on the rise, investors who want to stay in the stock market may be looking to the sector for bondlike income. Utilities also stand to benefit in some cases from rising energy prices. The war in Ukraine has sent energy prices higher amid concerns about global supply. Take a look at the top five performing Dow utility stocks this month. (Source: Factset. As of midday March 30, 2022.) The biggest gainer on the index in March is AES Corporation , up roughly 20% this month. The renewable energy power generator and utility provider has benefited from a heightened focus on alternative energy as the Russia-Ukraine war threatens oil supply. Investors can also gain exposure to the sector through exchange-traded funds. Take a look at three popular funds. (Source: Factset. As of midday March 30, 2022.) The Utilities Select Sector SPDR Fund , iShares U.S. Utilities ETF and Vanguard Utilities ETF are each up around 9% in March.
A trader works on the floor of the New York Stock Exchange (NYSE) in New York, March 30, 2022.
Brendan McDermid | Reuters
Utilities stocks are on a tear this month as investors seek steady assets amid market volatility.