Can you keep with up Volatility by Sector in the Midst of War with Iran
- Large cap Healthcare and Pharmaceuticals should be stable or gain as a Defensive Sector- But last week lost over 3%!
- SMID biotech stocks could rally this week but depends on Russell Performance near term :XBI, IWO and IWM.
- Three ETFs or Sectors to consider for rebalancing your portfolio:. Energy, Industrials, Aerospace/Defense (ITA), (XAR) But they are already up big. So look at beaten upTECH stocks MAGS down 0.59% 5 d, down 8.16% YTD; XLK down 1% 5d, down 4.64% YTD.
Cross-currents in the Markets : AI volatility now complicated by War with Iran.
We wrote recently about the sector swings in the market this month caused by AI, Economic data and Administration policies. Now we have to consider re-balancing of portfolio as the War with Iran brings implications for the global energy markets and Aerospace/Defense stocks as examples. Here are Sectors per State Street iSharers ETFs to track and performance as of 3/6/26 after one week of WAR:
- Sector Leaders in 2026 and past 5 days and YTD: Energy (XLE) up 1.4%, 26.3% , Materials (XLB) down 4% 5d, up 12% YTD, Industrials (XLI) ) down 2.63% 5 d, up 10.92% YTD, Information Technology (XLK) down 0.59% 5 d, down 2.63% YTD.
- Healthcare: XLV P $152.70, 5 d down 4.68%, down 1.36% YTD, up 2.3% 1 y., this ETF overweights biopharma, JNJ but top MEDtechs lagging MDT and SYK.
- Equal Weight SMID BIOtech: (XBI) P $124, 5 d down 2.65%, up 1.7% YTD, 1Y up 42.4%.
- Large cap weighted (IBB).P $167.56 5d down 4.45%, down 0.72%. YTD, I y up 23% A core position in large caps needs to comeback this week, with our top five positions: ABBV, BMY, FBIOX, GILD, LLY, RHHBY, NVS, VRTX.
- U.S. Medical Devices (IHI): P $56.76, 5d down 5.76% , down 8.67% YTD. This ETF is overweight ABT, ISRG, BSX, SYK and BDX. Tariffs are one issue.
Recently in February a Sector Review which include other focused ETFs like:Van ECK Pharmaceutical (PPH) P $105.94 down 5.16% up 2.68% YTD,1Y up12 %. The one year high was the $111 mark, a big drop.
PPH compared to XBI.
SMID Cap Biotechs-active trades and Stocks to Watch (all longs):
- Biodesix (BDSX) P $18.78 new to trading list, a new high flyer lung cancer diagnostics stock is up 18.78% this week. We owned a little of BDSX for 2 yrs and added more this week on a breakout,Q4 Revs at $28M, Market cap $150M ,Cash/sh at $1.94 and new $30 price target. Wm Blair Upgrade .
- Xencor (XNCR) P $11.32 on our trading list, a clinical stage biopharma we have owned since about $9 sh, focused on oncology and autoimmune diseases with unique technology for developing engineered therapeutic antibodies. Mark cap $830M, $7.7 cash/sh, Revs $125 M thru partners, was volatile this week because of royalty rift with partner Alexion on Ultomiris product. Buy ratings from Barclays , Piper and Wedbush.
Some of our best SMID Cap trades of the past 12 mos.
ABOS, ADPT, COGT, EYPT, PSNL, ROIV, RYTM, SUPN, XNCR.
Get ready for a volatile week. You should be overweight large cap biopharma, industrials/aerospace defense and energy going into this War. Week. But look for reversal to the upside for Technology and within one month a recovery for small caps (IWM,XBI).