Healthcare Stocks Have Momentum as Weakness in Tech Stocks Continues
- Big TECH bellwether comes on Wednesday with NVDIA Earnings; XLK down 5% for the week.
- Biotech stocks near top with minimal risk holding large caps.
- Impressive rally in medtech offers value trade to laggards: ABT,BDX
Here is our up to date thinking on biotech and healthcare stocks on the current bull market which began in June 2026 as we forecasted earlier in the year. Here is an article we wrote in JUNE 2026 when biotech and healthcare stocks got MOMENTUM after ASCO. We started focusing on sectors early in 2026 because of the dominance of technology stocks while waiting for some small shift to healhcare and biotech in 2026.
- Our top picks picked up strength at that time: ABBV, DNTH, XNCR and others such as XBI. which began in low 130s in late June and is now $165.
- Large cap biopharma had been ignored maybe because of Trump’s attacks on drug pricing in 2025 but primarily because of the huge gains and dominance of AI and semiconductor stocks.
- The pick-up coincided with other major market trends such as M&A, genomics in oncology (PSNL, NTRA and ILMN) and the digestion of ASCO news.
Also around that time interest was picking up in MEDTECH stocks with Abbott (ABT), Baxter Intl (BAX) and US Medical Devices (IHI) and the XLV healthcare ETF. So we thought that was a good time to make a call for a MEDTECH recovery but as a value play it could not have the momentum of the SMIDs. Abbott however was under $90 at the time and we bought ABT and recommended the stock saying it could easily go over $100. Last week the Company settled litigation on its infant formula business and the stock is now at the $116 level.
This all goes to say that if you want to shift trades to healthcare you should know which stocks are moving in the sector and it is not UnitedHealth (UNH) like in the past . Biotech and biopharma lead as you can see from this chart from tickers:ABBV, AMGN, JNJ, LLY, MRK, VRTX with some help from Medtech: ABT, BDX and MDT.
Review your stock portfolio with Sectors in mind
So let’s take look at major sectors using State Street Sector Tracker before the big financial meeting this week at and as we enter poor seasonality for equities in September. Here is the sector performance recently an YTD:
Past month Leaders: Healthcare, Energy, Materials, Consumer Discretionary…..Materials and Healthcare show gains.Alsowatch consumer areas like Consumer Discretionary (XLY) for gains.
Year to Date Leaders: Energy, InfoTech, Materials, Industrials…..The XLB is up 17% YTD and 4% MTD and could be a hedge against tech stocks which are trending down. Gold and industrial metal stocks also show gains with GLD up 14.36% MTD and GDX up 36.5% MTD!. The XME Metals and mining ETF is up 13% YTD and 15.4% MTD.
Healthcare and Biotech Today with TECH and Industrials Prices at 2:30P EDT.
- IBB flat to down 0.7% at $212 up 25% YTD.
- XBI down 0.9% at $164 up 34.6% YTD.
- XLV is flat at $174.40.
- ARKG at $48 down 2.78%, up 66% YTD.
- SMID movers: GH down 3.82% to $164, ILMN up 0.9% to $221.38, TEM down 8% to $66.56, PTCT up 2%to $71, XNCR up 5% to $29, other stocks mixed.