Amid rising concerns about stagflation, investors have continued to bid up the equities sector. As evidence, the benchmark S&P 500 sector is up over 13% year-to-date. However, the concern is that most of these tremendous gains are now concentrated in an elite minority of tech players known as the Magnificent Seven. These entities have recently combined to reach a market capitalization of nearly $21 trillion: great for them but not great for underperforming sectors like healthcare.
One of the laggards is the healthcare industry. Since the beginning of the year, exchange-traded funds that track the biggest names in the broader care ecosystem have traded slightly below parity — a far cry from benchmark indices as well as other individual sectors. Not surprisingly, the Trump administration and its policies play a major role in perceived risks.
