Wealth managers are backing the out-of-favour healthcare sector in 2017, despite plans by US President Donald Trump to 'repeal and replace' Obamacare and tackle drug pricing, on the view political headwinds are already priced into equities.
Prior to the US Presidential Election, healthcare firms had been fearful of a victory for Democrat Hillary Clinton and believed Trump would be the favourable option. Healthcare stocks fell in the first half of 2016 then rallied ahead of the election, before dropping sharply when it appeared Clinton was likely to win. She had hoped to deny drug companies tax breaks to restrict 'profiteering' and also tweeted about damaging price hikes for EpiPens. Shares in the sector jumped again in November when Trump was elected victor, up 18% (in sterling terms) between 3 and 14 November. ...
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