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Analysis

Healthcare Stocks, Dow Index Slide After Fed Cuts Rates

By Jack O'Brien  
   July 31, 2019

The Federal Reserve issued its first benchmark rate cut since 2008.

After the Federal Reserve's decision to cut its benchmark interest rate by a quarter of a point, a majority of healthcare stocks experienced a late afternoon slide.

The announcement to cut the target overnight lending rate from 2.25% to 2% was made at 2 p.m., followed by a press conference at 2:30 p.m. by Federal Reserve Chairman Jerome Powell. 

The Dow Jones U.S. Health Care Index bottomed at 1.50% within an hour of Chairman Powell's announcement, after spending most of Wednesday in the black. By 3:05 p.m., the index was only down 0.60%.

Related: Healthcare Sector is One of the Stock Market's Healthiest Sector Right Now

Teladoc Health endured one of the biggest drops at 3.04%, followed by Fresenius Medical Care at 2.75% and Centene Corp. at 2.30%.

UnitedHealth Group fell by 1.80%, CVS Health Corp. dropped by 1.26%, and WellCare Health Plans fell over 1.20%.

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Cigna Corp. and Anthem Inc. both experienced slight losses, but did not fall more than 1%.

Few healthcare stocks remained above board, with Magellan Health up 3.70%, Quorum Health Corp. up 3.60%, Humana up 4.31%, and HCA up slightly at 0.40%.

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Jack O'Brien is the finance editor at HealthLeaders, a Simplify Compliance brand.


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