Healthcare Sector Pointing to a GOP Senate

Is Healthcare Pricing in the GOP Keeping the U.S. Senate?

Sure, every sector is higher today but healthcare and biotech are dramatically outperforming the broader market.

Find out the rest of our election predictions, and which stocks will benefit.

With Hillary Clinton leading in polls ahead of Election Day, for weeks investors have widely expected biotech stocks to trend lower, but the iShares Nasdaq Biotech ETF (IBB) rallied nearly 4 percent Monday.

An NBC News/Survey Monkey poll released Monday morning found Clinton 6 points ahead of Donald Trump.

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Since the Lows from Last Week:

Biotechnologies ETF is up 6.1%
S&P Healthcare ETF is up 3.6%
The S&P 500 is only 2.2%

ibb-and-sp-health

The recent rise in healthcare is indicative of the senate staying red.

Should Trump win on Tuesday, the biotech sector would rally, according to Larry McDonald, head of global macro strategy of ACG Analytics and editor of the Bear Traps Report investment newsletter. However, if Clinton were to win, and Democrats gain control of the Senate, “that’s a big problem for the IBB,” McDonald told CNBC on Monday.

“If the GOP keeps the U.S. Senate (our call), IBB is a winner in our view. As Trump election odds surge, we believe this will help as well,” McDonald wrote, adding that if Clinton wins, and if Republicans maintain control of the Senate, biotech could experience a “profitable” relief rally.