LIVE MARKETS-RBC rotates into healthcare, trims US tech exposure

By Reuters News

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RBC ROTATES INTO HEALTHCARE, TRIMS US TECH EXPOSURE

RBC Capital Markets swapped its preference for US technology stocks in favour of healthcare, upgrading the latter to "overweight" and cutting tech to "market weight" on valuation concerns.

The brokerage said it wanted to rotate into cheaper areas of the market after a strong run in technology stocks, adding that its valuation indicators for the sector had deteriorated.

The AI boom has driven technology valuations higher over the past four years, but concerns over concentration risks and delayed returns on investments have recently pressured the sector.

RBC added that healthcare's relative performance has historically moved inversely to that of technology against the S&P 500 .SPX, making it "a natural destination to look to when dialing down tech exposure."

Healthcare will be a key point of debate heading into the November midterm elections, but the expected impact on companies could vary.


(Joel Jose)


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