As the world raced for vaccines and medicines in 2020 to prevent and treat the COVID-19 pandemic, S&P/ASX 200 Index (ASX: XJO) healthcare shares had some periods of strong outperformance.
But in recent weeks that outperformance, for most, has evaporated.
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ResMed and CSL share prices sliding
The ResMed Inc (ASX: RMD) share price has fallen 1.6% in intraday trading and is down by around 11% year to date. ResMed is best known for its respiratory medical devices.
Meanwhile, the CSL Limited (ASX: CSL) share price is down a significant 4.63% at the time of writing. This ASX 200 healthcare heavyweight has a historic focus on influenza vaccine development. And in 2021, CSL shares have fallen by around 10%.
By comparison, the ASX 200 is down 0.5% in intraday trading and up 1% year to date.
So what's going on?
Why are ASX 200 healthcare shares under pressure?
It's not just ASX 200 healthcare shares that have come under pressure in recent weeks.
The phenomenon is happening in share markets around the world. And it's closely linked with the rollout of the coronavirus vaccine.
As Bloomberg reports:
Equity investors are steering clear of drug makers and health-care service providers as continued progress in distributing COVID-19 vaccines adds to the momentum in stocks poised to benefit most from an economic reopening.
According to the article, five out of six of the largest healthcare shares listed on the S&P 500 Index (SP: .INX) had lost ground in afternoon trading yesterday (overnight Aussie time).
ABIOMED Inc. (NASDAQ: ABMD) closed the day down 5.4% and has slipped another 1% in after hours trading.
DexCom Inc. (NASDAQ: DXCM), with a market capitalisation of US$35.5 billion, lost 5.9% by the closing bell.
Commenting on the healthcare sector's performance, Goldman Sachs strategist Asad Haider said, "Investor conversations point to a generalist buyer's strike across the sector that likely needs some catalyst to reverse course."
I'm not sure what type of catalyst Haider is referring to. But let's hope it's not the unexpected need for even more respiratory devices and vaccines.
In the meantime, the declining share prices of both CSL and ResMed haven't prevented several leading brokers from giving these ASX 200 blue chip shares buy and outperform ratings.
