Utilities Feel The Heat

Utilities fell 1.18% yesterday for a third straight decline, pushing the sector further into extreme oversold territory as its 50-DMA crossed below its 200-DMA. It was just the third time this year that Utilities has fallen at least 1% in back-to-back days. Intraday, the sector tested a key level of support stemming from a January low before rebounding modestly into the close.

Edison International (EIX) and PG&E (PCG) did most of the damage. Both stocks were down more than 20%, making them the two biggest decliners in the S&P 500 yesterday. The two major California utilities sold off after lawmakers rejected Governor Gavin Newsom’s broader plan to limit their financial responsibility for wildfires caused by utility equipment. Under California law, utilities can be held responsible for property damage even without a finding of negligence. The narrower compromise focused on quicker payments to victims but offered little protection against litigation risk.

For EIX, the 23.1% decline was enough to become the stock’s third-worst day on record dating back to 1980, when data begins. The only two worse days were in 2000 and 2001. After shedding almost a quarter of its value, the stock is trading at its lowest level since 10/13/25.

PCG’s 20.1% slide marked a 52-week low and its lowest close since 7/7/25. It was the stock’s worst day since 3/18/20, but only its 14th-worst since 1980. Many of the larger declines came between 2018 and 2020, when the company faced massive claims stemming from the 2017 Northern California wildfires and the 2018 Camp Fire. Those liabilities pushed PG&E into Chapter 11 in January 2019, and the company did not emerge from bankruptcy until July 2020.