(Bloomberg) -- The downward spiral in the biggest drug and health services companies in the U.S. continued into its ninth day on Tuesday, with the sector set for its longest selloff since 1994.
Amid concerns about rising rates and a broader market rout, the sector has dropped almost 10% so far in January and is also poised for its worst monthly plunge since 2009. That compares with a 24% jump last year.
Investors have been turning away from pandemic stock winners as the market gets more optimistic that Covid-19 will be tamped down to a more manageable virus like the flu. Caught in the economic reopening trade are the scientific tools and service stocks that outperformed last year and of course vaccine makers including Pfizer Inc. and Moderna Inc.
The omicron variant has worked against the battered health-care sector in other ways too. Despite the potential mildness of omicron, its contagiousness spurred record case counts and hospitalizations and thereby delayed a return to elective procedures and driving down stocks like Align Technology Inc. and Intuitive Surgical Inc.
The slump has been potentially “grimmer than Covid” Oppenheimer strategist Jared Holz said. “The sector is mired in this macro oriented sell off while suffering from a lack of a big picture narrative to bring investors back in.”
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