Prior wins from the “Medicare-for-All” advocate were actually seen as good for health insurance stocks because analysts largely believe if Mr. Sanders wins the Democratic presidential nomination, it improves President Donald Trump’s reelection chances.
While this belief remains — “We have repeatedly heard from investors that they believe a Sanders nomination should be seen as a boost to the re-election of President Trump and/or a boost to Republicans winning full control of Congress,” one analyst told MarketWatch — other analysts point out conventional wisdom was against President Trump in 2016.
In a note to clients obtained by MarketWatch, JPMorgan analyst Gary Taylor said: “Are the rising odds of a Sanders nomination a negative catalyst for the sector (given his health-care views) or a positive catalyst as odds-makers boost Trump’s re-election chances? We think most health-care investors cite the latter but actually fear the former; which will render sentiment volatile and ephemeral over the next several months.”
UnitedHealth fell 7.8 percent Feb. 24, making it one of the biggest one-day declines since August 2011. Other insurers, including Cigna, Humana, Molina Healthcare and Anthem, also dropped.
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