Focus on health care and energy

Market impact of the presidential election cycle

Traditionally, there may be increased interest in a number of specific sectors when there are presidential elections in the United States.

•  Energy

The energy sector is traditionally volatile, with its development being affected by changes in supply and demand, the development of the US dollar, geopolitical developments and political debate. The energy policies of the Democrats and the Republicans in the current elections are very different.

Hillary Clinton is a clear proponent of alternative energy and has already put forward plans for a national target of 500 million solar panels and a reduction of oil consumption by a third within two presidential terms. Donald Trump is less clear about his future vision and has not expressed any specific preference for energy production. We can therefore expect a variety of measures to invest in alternative energy sources to be put forward.

• Health care

Hillary Clinton has clearly expressed her support for the Affordable Care Act, also known as “Obamacare”, that aims to cut medical costs and make health insurance less expensive. Clinton wants to further reduce the costs of health care, among other things by reducing the prices of prescription drugs.

Donald Trump is not convinced by “Obamacare” and wants to implement new reforms (including no mandatory health insurance and opening the market up to more competition, making health insurance premiums tax deductible…).

One should however not take account of the outcome of the presidential elections when deciding whether or not to invest in this sector. Demand in health care is not particularly closely related to the development of the economy. The sector has a strong track record with growth in the next three years that is expected to significantly outstrip that of the market as a whole.