Less than a week after the mid-term elections, health-care stocks have emerged as winners.
Health care was a top issue ahead of the election, with voters demanding a response to drug prices and the cost of care. Maybe that’s why stocks in the sector had their best day in two years on the Wednesday after the election, gaining almost 3 percent overall.
It was hard for any of the election combatants to deny an increased need since the aging Boomer and low-income populations require more extensive drug treatment and medical care. For his part, President Trump adopted a combative stance to drug pricing on the campaign trail, rattling pharmaceuticals and biotech stocks.
Still, the White House gave the industry some relief in May by not allowing the government to negotiate drug prices or permitting the importation of foreign prescription drugs.
As political pundits assess likely policy initiatives, they may find pharmaceutical pricing to be an area where Republicans and Democrats can agree.
In California, voters rejected a ballot initiative capping profits for dialysis services providers. That lifted stocks like DaVita (DVA) and Henry Schein Inc. (HSIC).
In conclusion, this week’s elections were pretty much a draw between the two political parties. But investors seem to think that health care was the real winner.