Key Highlights

● Utilities and staples ranked among the four strongest of 11 S&P 500 sectors on Thursday.

● The S&P 500 slipped 23.59 points to 7,720.39 while the Nasdaq Composite fell 365.13 points.

● Xcel Energy and WEC Energy Group both beat Earnings estimates and tightened 2026 guidance.

● Altria rose on a beat and a $1 billion buyback expansion.

Power companies and household-name staples climbed on Thursday as investors fled the AI megacaps for steadier earners, helping most of the market rise even as the S&P 500 slipped.

A defensive bid on a split day

The scoreboard said "down day." The sector map said otherwise. The S&P 500 slipped 23.59 points to 7,720.39 on Thursday, October 29, and the Nasdaq Composite tumbled 365.13 points to 26,184.72, dragged by Alphabet (NASDAQ:GOOGL)'s worst session since its 2004 IPO. Yet consumer staples and utilities ranked among the four strongest of the 11 S&P 500 sectors, according to market data, trailing only health care and real estate.

Utilities and staples are the market's classic shelter. Their customers keep paying electric bills and buying groceries, toothpaste and snacks whatever happens to the AI trade, so their profits tend to swing less with the economic cycle. When a megacap stumbles hard, that steadiness looks more valuable.

One market strategist summed up the mood: "Money is rotating within the market rather than leaving it."

Utilities: earnings beats and a softer bond market

The Utility rally had more behind it than fear. Xcel Energy (NASDAQ:XEL) climbed after reporting third-quarter adjusted earnings of $1.52 a share, ahead of the $1.37 consensus, even though Revenue of $4.17 billion came in slightly under estimates, according to market data. The company narrowed its 2026 profit forecast to $4.10 to $4.16 a share and offered an initial 2027 outlook of $4.48 to $4.62.

WEC Energy Group (NYSE:WEC) also beat, posting quarterly earnings of $1.18 a share against a $0.98 estimate and tightening its 2026 guidance to $5.60 to $5.64, according to media reports. One report described the sector's climb as part of a rotation out of mega-cap tech.

Bonds helped too. Utilities compete with Treasuries for income-seeking investors, and the 10-year Yield eased on Thursday, slipping back from the multi-decade highs it touched around October 1. Sources differed on the size of the dip, but all pointed lower.

Staples: from tobacco to grocery aisles

In staples, Altria (NYSE:MO) rose after beating on revenue and adjusted earnings, raising its full-year profit guidance and expanding its buyback by $1 billion, one report said. Pricing offset a decline in domestic cigarette volumes.

The group was not uniformly calm. Sprouts Farmers Market (NASDAQ:SFM) plunged after guiding fourth-quarter earnings to $0.47 to $0.51 a share, far below the $1.21 analysts expected, and announcing price cuts. One analyst, who kept an Overweight rating, said: "We do not expect a smooth road ahead." Sprouts also said COO Nicholas Konat will succeed CEO Jack Sinclair in early January.

After the bell, Mondelez (NASDAQ:MDLZ) climbed in extended trading after its earnings topped forecasts, a fresh vote of confidence for snack makers heading into Friday.

Why defensives, and why now

Thursday's economic data complicated the picture. Third-quarter GDP accelerated sharply from the second quarter and beat forecasts, while September PCE Inflation ran hot. Strong growth usually favors cyclicals, not defensives. But the hot inflation print kept bets on a December Fed rate hike elevated, and the Fed had just held rates steady on Wednesday after hiking in September.

That mix of robust growth, stubborn inflation and wobbling tech Leadership pushed investors toward companies whose earnings depend least on the AI spending cycle. One Investment strategist put it plainly: "There's plenty of other places to go with your money outside of the AI trade that have pretty decent prospects."

What to watch

Dominion Energy (NYSE:D) reports before Friday's open, with analysts expecting $1.19 a share on $4.88 billion of revenue, while its proposed Takeover by NextEra Energy (NYSE:NEE) faces scrutiny in Virginia. Friday also brings the Employment Cost index at 8:30 a.m. ET, a key read on wage pressure. If yields keep easing, the defensive bid could have room to run. If wage data rekindles hike fears, rate-sensitive utilities may feel it first.