In addition to concerns over looming interest rate hikes, the Russia-Ukraine war has been fostering immense volatility in the stock market. However, considering the solid growth prospects of the healthcare industry on the back of rising demand from an aging population and continuing research breakthroughs, it could be wise to bet on fundamentally sound stocks from this sector on their current price dips.
The healthcare sector is known for stability because of the near-inelastic demand for healthcare solutions. Furthermore, rising capital inflows for R&D projects worldwide since the onset of the COVID-19 pandemic should keep driving the industry’s growth. Investors’ interest in the industry is evident in the Health Care Select Sector SPDR ETF’s (XLV) 1.7% gains over the past three months versus the SPDR S&P 500 Trust ETF’s (SPY) negative returns. And the global consumer healthcare market is expected to grow at an 8.6% CAGR to $6.65 trillion by 2028.
