The utilities (XLU) sector managed to defy Friday's steep market sell-off, gaining into the close to end the session 0.16% higher. Year to date, the group is one of the strongest performers in the S&P 500 (^GSPC). Bret Kenwell, eToro U.S. Investment and Options Analyst, joined Market Domination to discuss the sector's recent gains - and catalysts going forward.

Historically, in periods of volatility investors flock to utilities for stable and steady growth. But looking at the group today, Kenwell sees "a collection of other catalysts" at play that could drive further gains. He notes the sector is projected to see its best year of earnings growth since 2009, on top of attractive valuation and the near-certainty of a September rate cut (thanks to Friday's weak jobs report).

Looking to the broader market, Kenwell doesn't expect the current rotation out of megacap tech and into small caps to continue for all that long. "I think that at some point investors are going to start circling back at those names," he says, pointing to the recent declines in Nvidia (NVDA), Alphabet (GOOG, GOOGL), Microsoft (MSFT), and Amazon (AMZN).

Watch the video above to hear what Kenwell says about the healthcare sector.

For more expert insight and the latest market action, click here to watch this full episode of Market Domination.

This post was written by Kathleen Welch