In a topsy-turvy investment environment, utilities have been among the sexiest sectors—up 16 percent in the first half of 2014.

Tobias Levkovich, Citigroup's chief U.S. equity strategist, told CNBC on Tuesday the returns made sense from a certain point of view.

"I think everybody likes to think of the world in very simplistic terms. You know, rates go up, rates go down, stocks do the following," he said on "Halftime Report," "I don't think anybody would've expected a better economy and consumer discretionary to be the worst-performing sector in the S&P, and nobody would've expected health care to do well in the first half of the year in an environment where people are buying cyclicals.

"So, these very simplistic approaches, I think, are just flawed."