Diversified healthcare exchange traded funds, including the Vanguard Health Care ETF (NYSEArca: VHT) and the Health Care Select Sector SPDR (NYSEArca: XLV), have struggled mightily this year. With Election Day just a few days away, those struggles are intensifying.
For example, XLV is down 7.3% over the past week bringing its year-to-date decline to 6.4%. Making matters worse for the healthcare sector, the second-largest sector weight in the S&P 500, is that previous areas of strength, such as medical devices makers, are faltering as well.
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The technical prognosis is not encouraging for ETFs such as XLV.
Drug and biotech stocks led the decline while medical device and equipment makers seemed to be more resilient. However, as the presidential election nears, this last holdout has started to succumb to the bears. I’ll leave it to political pundits to debate whether this is an indication on how the election is tipping,” reports Michael Kahn for Barron’s.
Until recently, one of the areas strength in the otherwise downtrodden sector had been medical devices stocks and ETFs such as the iShares U.S. Medical Devices ETF (NYSEArca: IHI), the largest dedicated medical devices exchange traded fund.[related_stories]