Smart meters are useful to utilities for two very specific, immediately practical reasons:
They reduce labor needed for meter readings and home visits.
They give time of use data, which allows the utility to set prices for the customer that change based on time of day or the season, effectively discouraging electricity use when prices are really high.
Smart meters actually don't have much of an effect on trading or hedging strategy. Utilities already have real-time customer demand data at aggregated levels. If they didn't, they wouldn't be able to constantly supply the right amount of power to their customers -- electricity can't be stored, so there's a constant balancing act between demand and supply. When demand goes up, the price of power goes up.
Utilities don't want customers to use electricity when electricity prices on the wholesale market are really high because they end up with lower profit margins, or even end up paying more for the electricity than they're billing the customer. Smart meters help change that by giving the utility the means to charge more when price are usually higher. They also deter customers from using electricity during times there may be major price spikes incidents that utilities can't reasonably pass on to the customer.
This is a pretty short explanation, and I've purposefully left out mention of residential demand response because that involves more than just a smart meter. You may also take issue with a couple simplified concepts; for example, utilities aren't necessarily losing money when real-time prices are really high, because they might be able to cover demand just by running the plants they already own. However, they're losing the opportunity to sell their own electricity onto the market at very high prices. Essentially, it's still lost money.
The facts in this answer (that smart meters send real-time or near-to-real-time data, that electricity can't be stored, that utilities didn't used to know what time of day customers were using electricity, that there can be a lot of volatility in wholesale electricity markets) are probably too basic to need a citation? I'm still trying to get a feel for what the standards are at the Stack Exchange community... I think this just building a framework around the facts that have already been established in this thread.