Healthcare stocks rally as investors seek safety amid tech debt worries
XLV•The S&P 500 healthcare index hit a record high Thursday and was last up 2.8% as investors rotated into defensive stocks over concerns about highly leveraged technology companies. Eli Lilly shares rose 5.2%, while Bristol Myers, Amgen, AbbVie, J&J and Pfizer gained 2% to 4%.
1. Healthcare index sets record
The S&P 500 healthcare index hit a record high on Thursday as investors rotated into defensive stocks amid concerns about a potential debt crisis among highly leveraged technology companies. The index was last up 2.8%.
2. Drugmakers gain
Eli Lilly shares rose 5.2%, while Bristol Myers, Amgen, AbbVie, J&J and Pfizer were up between 2% and 4%. “We also saw a rotation into the very defensive consumer staples, health care and utility stocks,” said Sam Stovall, chief investment strategist at CFRA Research.
3. RBC shifts preference
On Wednesday, RBC Capital Markets upgraded healthcare to “overweight” and cut technology to “market weight,” swapping its preference for US technology stocks in favor of healthcare on valuation concerns.
