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Strong gains for other healthcare stocks are being driven by the current economic cycle rather than the epidemic. In times of crisis, health care stocks are often well maintained. They are considered to be stable companies that provide the products and services that people need even in times of crisis.
And many health care providers also pay a large share and are relatively cheap compared to the rest of the market.
In a recent report, US Chief Investment Officer at UBS Global Wealth Solita Marcelli said health care is “trading at an attractive price for a delayed cycle.”
A.D. He said international healthcare stocks are expected to grow by more than 6 percent in the wider market as the manufacturing sector has been declining since 2003. (The ISM Manufacturing Index is the second lowest since May 2020.)
Lauren Goodwin, an economist and portfolio strategist at New York Life Investments, added in the report that “as long as economic growth continues,” investors should stick to quality stocks. She specifically mentions health care, as well as utilities and real estate, the other two sectors in large part.
Of course there are dangers. Depending on the outcome of the Middle Ages, health care companies may be more closely monitored than regulators and politicians. If Republicans control the House and Senate, there may be questions about the future Obamacare and what this could mean for drug prices.
But as long as the Federal Reserve raises interest rates and investors continue to complain about inflation, health care stocks on Capitol Hill could remain well.
“It was a quality flight in the stock market,” said Edward Campbell, co-founder of PGIM Quantitative Solutions. “I’m not surprised to see that more classical defense sectors, such as health care, are doing well.”
All eyes at work
Thanks to rising prices, rising oil and gas prices, and fears of a slowdown in the housing market, fears of a recession are growing. But one of the most important parts of the U.S. economy – the labor market – remains strong.
Many businesses find it difficult to hire workers in the middle of a major strike, and employees are in the driver’s seat, ordering a healthy paycheck. But can even the labor market finally be ready to turn into a bad situation?
The government will report June salary figures on Friday. The data includes the weekly unemployment rate and monthly reports from the pay processor ADP on the private sector jobs as well as a busy week’s work report including government job vacancies and the JOLTS study.
Unemployment is expected to remain at 3.6%, but could eventually rise. According to forecasts at the final meeting of the federation earlier this month, Central Bank members are expected to lose 3.7% this year, to 3.9% next year and 4.1% by 2024.
That is still the lowest in history. But as wages rise, there are fears that American workers will not be able to keep up with rising inflation. The average hourly wage in May rose 5.2 percent year-on-year, down from 5.5 percent in April.
Economists, investors and job seekers are keeping a close eye on the numbers in June to see if wage growth continues.
Next
Monday: American markets are closed for Independence Day.
Tuesday: American Factory Orders
Wednesday: Non-US ISM manufacturer index; Minutes from the June meeting of the US Federation
Friday: U.S. jobs for June
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