Key Highlights

● NiSource expanded its agreement with Microsoft.

● The company raised its long-term growth target.

● Utilities were the worst-performing S&P 500 sector that day.

● NiSource also narrowed its 2026 guidance.

NiSource (NYSE:NI) edged higher on Wednesday, October 28, managing a small gain on a day when utilities were the worst-performing S&P 500 sector.

The natural gas and electric utility's results came with several announcements, including an expanded agreement with Microsoft, a sign that data-center demand is reaching even regulated power companies.

The Microsoft Connection

NiSource expanded its agreement with Microsoft (NASDAQ:MSFT), according to market reports. While the full terms were not detailed in those reports, the deal ties NiSource more closely to one of the largest builders of AI data centers in the world.

Data centers consume vast amounts of electricity, and utilities that can supply reliable power are increasingly in demand from technology companies. NiSource also narrowed its 2026 guidance and raised its long-term growth target, which can give investors more certainty while pointing to faster expansion ahead.

What NiSource Does

NiSource is one of the largest fully regulated utility companies in the United States, providing natural gas service to customers in several states and electricity in northern Indiana. Its earnings are largely set by state regulators, which approve the rates it can charge and the returns it can earn on investment.

That structure tends to make its results more predictable than those of unregulated power producers.

Bucking a Weak Sector

Utilities were the worst performers among the 11 S&P 500 sectors on Wednesday, with real estate and consumer staples also lagging. All are considered rate-sensitive, and they came under pressure as long-dated Treasury yields climbed, with the 10-year pushing past a key psychological threshold.

American Electric Power (NASDAQ:AEP) slipped despite raising its own outlook, expanding its capital plan and citing data-center demand, showing how heavy the rate pressure was on the group. NiSource's ability to hold a gain stood out. Melius Research's James West said AI compute is a natural gas demand story.

What to Watch

The S&P 500 rose 21.38 points to 7,743.98, its third straight gain. Technology and energy led the market. Microsoft reported after the bell and rose in extended trading as its Azure cloud business accelerated, a sign that demand for cloud and AI computing remains strong.

On Thursday, the advance third-quarter GDP estimate and September PCE inflation data arrive at 8:30 a.m. ET. For utilities, the path of Treasury yields will be crucial. Amazon (NASDAQ:AMZN) reports after Thursday's close.