These stocks have the most to gain as the 10-year Treasury yield tumbles below 4%
Rates are plunging after the Federal Reserve on Wednesday left interest rates unchanged and penciled in several cuts in the new year. The move, and commentary from Fed Chair Jerome Powell, led Treasury yields to fall sharply. The benchmark 10-year Treasury note yield was last down nearly 11 basis points at 3.926%, breaching the key 4% mark for the first time since August. At its session low, the benchmark rate traded at levels not seen since July. Stocks also roared higher on the back of that Fed forecast, with the Dow Jones Industrial Average reaching a record above 37,000. Against this falling rate backdrop, investors may benefit from looking at stocks with high sensitivity to falling interest rates. Bank of America recently laid out some names with strong inverse correlations to changes in the 10-year yield. The list conjured up a slew of consumer-focused names and utilities companies that benefit from less competition from interest rates. Here are some of those names: Video game publisher Take-Two Interactive is one of the names that could benefit as rates fall. Shares of the company, set to join the Nasdaq-100 later this month, have rallied nearly 57% this year. A handful of utilities companies also made the cut. These businesses tend to benefit from diminished interest rate competition and are often viewed as safe havens to park cash during economic uncertainty given their stable yields. American Water Works , NextEra Energy and WEC Energy Group were all included in Bank of America's list. All three stocks have struggled this year as investors flock to less risky Treasurys offering attractive yields for the better part of 2023. Chipotle Mexican Grill and discount retailer Dollar General could also benefit as rates slump. Chipotle has experienced a strong year, with shares up 66%. Dollar General has slumped 48% as sales growth slowed. Several real estate companies and real estate investment trusts also made the cut, including Prologis and Ventas .