No sector has been plagued election year antics and volatility on par with healthcare, the third-largest sector weight in the S&P 500. Political posturing has been weighing on exchange traded funds such as the Vanguard Health Care ETF (NYSEArca: VHT) and the Health Care Select Sector SPDR (NYSEArca: XLV).
Last month, Democratic presidential nominee, Hillary Clinton, put the spotlight on Mylan (NasdaqGS: MYL) EpiPen prices, triggering a selloff in biotech exchange traded funds and reminding investors of political risks in an election season. Here comments were particularly painful for ETFs such as the iShares Nasdaq Biotechnology ETF (NasdaqGM: IBB) and the SPDR S&P Biotech ETF (NYSEArca: XBI).
This was the third time over the past year that Clinton’s comments upended drug stocks. The presidential runner has repeatedly censured aggressive drug pricing. With most polls giving her a wide margin over Republican nominee Donald Trump, the markets are taking Clinton’s words more seriously.
Heading into October, a historically tricky month for stocks, some market observers seen more volatility ahead for healthcare stocks as Election Day nears.
“The market in autumn tends to see an uptick in volatility — and Goldman Sachs forecasts the health-care sector could see a particularly rocky upcoming month,” reports CNBC.