We attended the 35th annual J.P. Morgan Healthcare Conference 2017 from January 9th to 12th in San Francisco.
With 467 companies participating (USD 4.3tn in market cap), over 10’000 attendees and over 12’000 organized 1 on 1 meetings, the conference normally sets the tone for the healthcare investment year. Company executives were confident regarding their fundamentals. While uncertainty around the ACA repeal and replacement remains high, the US corporate tax reform could lead to earnings accretion for the sector.
In April, Healthcare rebounded after a subdued Q1, with the MSCI World Healthcare NR Index gaining 3.8% during the month. The MSCI World NR Index increased 4.7%. Re-opening/cyclical sectors suffered a temporary sharp selloff during the month. 10-year Treasury yields also backed down (from a peak of 1.74% at March-end to 1.64% today), potentially indicating some risk that it is too early to sound the all-clear on COVID-19.
Global equity markets remained volatile throughout the month due to news surrounding re-opening of economies, upward moving Treasury rates, fears of new COVID-19 waves and political/medical interfering with AstraZeneca’s vaccine. The MSCI World Healthcare NR Index gained 2.5% in March, while the MSCI World NR Index rose 3.3.
The MSCI World Healthcare NR Index returned -2.7% in February, while the MSCI World NR Index rose 2.6%. During the last week of the month, many sectors took a hit because of rising 10-year Treasury rates (now at their highest levels in a year), enhancing on one hand the attractiveness of bonds vs. Equities and on the other hand propelling cyclical stocks.