Here Is Something Sweet For Stocks That Isn’t the Tech Sector
Here Is Something Sweet For Stocks That Isn’t the Tech Sector
(Bloomberg) -- The strong rebound in Asia equities has continued in July. Helping keep the market in shape are real estate and technology stocks -- and health-care shares.
Ranked the third-best-performing industry in Asia this month, health-care stocks jumped 1.4% month-to-date, beating the region’s benchmark MSCI Asia Pacific Index, which held a mere 0.4% gain. The outperformance of health care may be more than a pure defensive play, as the utility sector only gained about 0.8%.
A policy-driven rally in Chinese drugmakers this month contributed to the sector’s strength, as six out of the 10 best-performing health-care stocks in July are from China. On Monday, CSPC Pharmaceutical Group Ltd and Sino Biopharmaceutical Ltd surged more than 5% after a local news report that a centralized drug procurement plan hurting drugmakers’ profit will be expanded nationwide on milder terms than expected.
Analysts see more room for gains in China’s health-care universe. Citigroup Inc. said in a research note that the country’s entry into international organizations for drugs registration and development in 2017 could speed up major reforms in the industry, and offer big opportunities to both global and local players. The firm believes the pharma sector in China could grow at a 8% compound annual growth rate, led by innovative drugs, generics and biosimilars, analysts led by John Yung wrote.
There are also some notable moves in the health-care sector Tuesday. In Japan, Cosmos Pharmaceutical Corp. rallied the most since January after posting strong profit. And over in South Korea, medical companies like SillaJen Inc and Medy-Tox Inc rebounded after showing oversold signs, defending the benchmark from falling more.
Elsewhere, Asia is quiet as earnings season unfolds. On the trade front, U.S. Treasury Secretary Steven Mnuchin said he and Trade representative Robert Lighthizer may travel to Beijing for negotiations if talks by phone this week are productive.
Stock-Market Summary
- Japan’s Topix index down 0.5%; Nikkei 225 down 0.7%
- Hong Kong’s Hang Seng Index little changed; Hang Seng China Enterprises little changed; Shanghai Composite little changed
- Taiwan’s Taiex index little changed
- South Korea’s Kospi index up 0.2%; Kospi 200 up 0.3%
- Australia’s S&P/ASX 200 little changed; New Zealand’s S&P/NZX 50 down 0.1%
- NSE Nifty 50 futures up 0.4%
- Singapore’s Straits Times Index up 0.2%; Malaysia’s KLCI down 0.3%; Philippine Stock Exchange up 0.5%; Jakarta Composite down 0.3%; Vietnam’s VN Index up 0.6%
To contact the reporter on this story: Moxy Ying in Hong Kong at yying13@bloomberg.net
To contact the editors responsible for this story: Divya Balji at dbalji1@bloomberg.net, Joanna Ossinger, Lianting Tu
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