Once again, a sell-off in tech stocks acted as a trigger for broader market losses on Tuesday. Sector heavyweights suffered reverses due to disparate concerns. But financials also declined after Treasury yields plummeted leading to broad losses for the bourses. And it is widely believed that the rout in tech stocks, which is likely to continue, was responsible for this turn of events as well.

Predictably, defensive stocks have caught investors’ fancy in the interim. These stocks can help shore up hard-earned profits during difficult market conditions. Further, they offer appreciably higher dividend yields. Adding stocks from the utilities, telecom and real estate domains to your portfolios looks like a prudent option at this point.

Tech’s Decline Leads to Market Rout

On Tuesday, shares of Apple Inc. (AAPL - Free Report) and Amazon.com, Inc. (AMZN- Free Report) declined 2.6% and 3.8%, respectively, leading to a 2.9% decline for the Nasdaq which suffered its sharpest one-day reverse since early February. Further, the Technology Select Sector SPDR (XLK) lost 3.2% even as Microsoft emerged as the worst performer for the Dow, losing a whopping 4.6%.

The initial trigger for last week’s tech losses, a reversal in Facebook Inc.’s (FB - Free Report) fortunes, remained very much in evidence. Shares of the social media giant lost 4.9% after Bank of America Merrill Lynch, the investment banking wing of Bank of America (BAC - Free Report) , lowered its price target for the stock for the second occasion in five days.

Even as Facebook continued to suffer from the fallout of the Cambridge Analytica scandal, a variety of self-driving related concerns felled NVIDIA Corporation (NVDA - Free Report) and Tesla, Inc. (TSLA - Free Report) .

Shares of NVIDIA lost 7.8% after the chipmaker put on hold all of its self-driving tests, according to Reuters. Meanwhile, Tesla’s shares declined 8.2% after the U.S. National Transportation Safety Board launched an investigation into a crash that occurred last week.

Defensive Plays Back in Favor?

For the S&P 500, the only gainers for the day were the Utilities Select Sector SPDR ETF (XLU) and the Real Estate Select Sector SPDR (XLRE), which increased 1.4% and 0.2%, respectively. The SPDR S&P Telecom ETF (XTL) ended the day virtually unchanged, even though telecom stocks had gained 1.3% at one point.

The reason for the renewed popularity of these defensive options is clear. Such stocks offer a moat against the kind of uncertainty prevailing in the markets at the moment. Not only can they shore up hard-won gains, they offer dividend yields which are appreciably higher than the market average.

To put things in perspective, the utility, telecom, and real estate sectors offer average yields of 3.5%, 5.6% and 3.4%, respectively. Meanwhile, the average yield for the S&P 500 stands at just 1.8%.

Our Choices

A tech stock rout is threatening to thwart markets’ nascent recovery from February’s correction. A variety of factors are threatening to snap tech stocks’ spectacular run of gains. This, in turn, is likely to create significant market turmoil in the near term.

Given this backdrop, investors would do well to invest in defensive stocks. Such stocks provide steady dividends irrespective of prevailing market conditions. Typically, utilities, real estate and telecom, whose demand remains undiminished even during tough times, are considered to be defensive stocks. We have narrowed down our search to the following stocks based on a good Zacks Rank and other relevant metrics.

South Jersey Industries, Inc. (SJI - Free Report) is a provider of products and services related to energy. It purchases, transmits and sells natural gas.

South Jersey Industries has a Zacks Rank #1 (Strong Buy). The company has expected earnings growth of 25.6% for the current year. The Zacks Consensus Estimate for the current year has improved by 6.9% over the last 60 days. South Jersey Industries has a dividend yield of 4.1%.

New Jersey Resources Corporation (NJR - Free Report) is an energy services holding company that, through its subsidiaries, provides safe and reliable natural gas and clean energy services, including transportation, distribution, asset management and home services.

New Jersey Resources has a Zacks Rank #1. The company has expected earnings growth of 50.4% for the current year The Zacks Consensus Estimate for the current year has improved by more than 0.1% over the last 30 days. The stock has a dividend yield of 1.6%. New Jersey Resources has a dividend yield of 2.8%.

PotlatchDeltic Corporation (PCH - Free Report) is a Real Estate Investment Trust (REIT) which owns timberland in Alabama, Arkansas, Idaho, Minnesota and Mississippi.

PotlatchDeltic has expected earnings growth of 26.4% for the current year. The Zacks Consensus Estimate for the current year has improved by 0.4% over the last 30 days. The stock has a dividend yield of 3.1%. The stock has a Zacks Rank #1.

M.D.C. Holdings, Inc. (MDC - Free Report) engages in homebuilding and financial service businesses in the United States.

M.D.C. Holdings has a Zacks Rank #2 (Buy). The company has expected earnings growth of 15.6% for the current year. The Zacks Consensus Estimate for the current year has improved by 13.3% over the last 60 days. The stock has a dividend yield of 4.3%.

BT Group plc (BT - Free Report) is one of the world's leading providers of communications services and solutions, serving customers in more than 170 countries. BT Group is based in London, United Kingdom.

BT Group has a Zacks Rank #2. The company has expected earnings growth of 2.4% for the current year. The Zacks Consensus Estimate for the current year has improved by 4.3% over the last 60 days. The stock has a dividend yield of 6.3%.

Telefónica, S.A. (TEF - Free Report) provides fixed-line telephone services, wireless communications, Internet access, video and data transmission services, to approximately 313 million customers. Telefónica is based in Madrid, Spain.

Telefónica has a Zacks Rank #2. The company has expected earnings growth of 17.3% for the current year. The Zacks Consensus Estimate for the current year has improved by 4.8% over the last 30 days. The stock has a dividend yield of 3.6%.