Almost three-quarters of hedge fund managers and economic experts have named healthcare and pharmaceuticals as the sector more likely to increase in value over the next 12 months.
A survey of hedge fund managers and economic experts globally found 73% expected those sectors to increase in value while 66% felt that way about the technology sector.
However, the number was lower in Australia specifically where only 60% expected healthcare to rise in value.
This was helped by the sectors’ efforts to find a COVID-19 vaccine which would be a key focus for 2021 as the world aims to stem the global pandemic. Stocks currently working on a COVID-19 vaccine trial included GlaxoSmithKline, Johnson & Johnson and Moderna while others such as Roche and Gilead Sciences were working on treatments.
As well as efforts on a COVID-19 vaccine, these companies were also likely to benefit in the long term as people would become more aware of their health via supplements and healthy lifestyles and companies would likely need to keep creating drugs as the COVID-19 virus mutated into different strains.
Max Hayden, global head of prime brokerage sales at IG, said: “The pharma industry in terms of growth opportunities will come in two parts.
“As you would expect with the development of a vaccine and related drugs around it, companies that are working on and will achieve that obviously are the ones to watch for the future. We can see those industries growing over the next months and years.”
Oil and precious metals were least expected to increase in value with just 15% and 18% of respondents, respectively, expecting to see value increases in those sectors.