Stocks to watch at the open

The US shutdown has put yield back on the agenda given its tapering implications and Leighton Holdings is back in the headlines for all the wrong reasons.


Domestic utilities have weathered the US government shutdown the best of any sector over the past five days. Utilities are up close 0.95% against an index decline of over 1%.

With international equity markets feeling uneasy about the US government shutdown overnight, utilities are primed to be favoured by investors today. The falling yield on the 10-year US Treasury Note is favourable to the sector, especially in a time when investors are hunting for yield (see Adam Carr's Stay with the yield play).

Utilities were the biggest gainer on the London-based FTSE overnight, adding 1.06% against a loss of 0.35% for the index.

Leighton Holdings (LEI)

Hochtief AG, the major shareholder of Leighton fell over 7% as new information about the poor corporate governance practices at Leighton’s came to light. Corruption at Leighton’s dates back to 2010 and 2011.

In addition to corruption claims, Leighton’s has also previously failed to comply with continuous disclosure rules. In 2012 regulator ASIC slapped Leighton’s with a $300,000 fine for not updating the market over three of its projects.

Investors in Leighton’s will be feeling uneasy with information concerning the corruption back in the headlines.

InvestSMART FORUM: Come and meet the team

We're loading up the van and going on tour from April to June, with events on the NSW central & north coast, the QLD mid-north coast and in Perth, Adelaide, Melbourne, Sydney and Canberra. Come and meet the team and take home simple strategies that you can use to build an investment portfolio to weather any storm. Book your spot here.

Want access to our latest research and new buy ideas?

Start a free 15 day trial and gain access to our research, recommendations and market-beating model portfolios.

Sign up for free

Related Articles