The Australian Healthcare Sector has surged ~30% since late October, and although we are bullish over the coming years, a period of consolidation is overdue, and an 8-10% pullback wouldn’t surprise – at current levels, we aren’t looking to increase our exposure to the sector, pretty much in line with our view on the market in general. The sector has shown a strong inverse correlation to bond yields over the years, falling sharply when bonds rally/yields fall and vice versa. MM’s macro outlook is yields will fall through 2024/5 but not as fast as many hope, and the futures are pricing, another reason why we can see a pullback following the recent strong advance.
- We have been advocating a more defensive stance through 2024, with the Healthcare Sector fitting the bill perfectly with good entry levels.
MM likes the ASX Healthcare Sector medium-term
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This morning, we have briefly looked at five stocks in the ASX200 Healthcare Sector with a specific eye on levels we would like the risk/reward to start accumulating:
