U.S. stocks were dragged lower after Trump’s comments. Leading the fallout, the healthcare sector suffered the most on Trump’s commitment to fight against exorbitant drug prices, with the broad Health Care Select Sector SPDR (NYSEArca: XLV) down 1.7% on Wednesday.
They’re “getting away with murder,” Trump said of pharmaceutical companies. The President-elect also called for “new bidding procedures” for the drug industry, the Wall Street Journal reports.
“The healthcare space is definitely going to be a vertical in the market that is going to see some volatility and it is going to be day-to-day,” Peter Kenny, senior market strategist at Global Markets Advisory Group, told Reuters.
The markets have strengthened in recent weeks to record highs as investors speculated on business friendly policies under Trump. However, many observers also anticipate heightened volatility ahead as the nation gains more clarity on Trump’s vision ahead.
“A lot of people are looking for reasons to become worried or concerned,” Robert Pavlik, chief market strategist at Boston Private Wealth, told the WSJ, adding that in the long term, stocks have the potential to “move quite a bit higher.”
Stocks were higher in early morning trading ahead of the speech but quickly soured as Trump addressed issues from Russian hacking to drug prices and his family business. Investors also closely watched for clues on the timing and the scope of his planned policies, notably in infrastructure spending and trade policies that could affect financial markets in the year ahead.
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