Are We Seeing A Sector Rotation Away From Financials And Into Healthcare?

Sector rotation is very common in the stock market as investors allocate investment dollars from an undperforming sector to an outperforming sector, or a sector that has the potential to offer superior returns. "There's always rotation going on in these markets from one sector to another," Joel Elconin, co-host of Benzinga's daily PreMarket Prep explained during Wednesday's edition. "There are a lot of different places people can place their money." JJ Kinahan, TDAmeritrade's Chief Strategist was a guest on the segment and offered his expert opinion on sector rotation. He said that it was perhaps a bit surprising to see a sector rotation outside of financials, despite the fact that there has been no interest rate increase. He added that many major financial firms touted that the exposure of their retail and corporate clients "seem to be going really well" - a fact that makes a sector rotation outside of financials even more surprising. Kinahan continued that the healthcare segment is showing some good earnings results and he expects investors to rotate back into the space. However, he cautioned that in an election year, the healthcare sector is the most vulnerable out of every sector to rule and law changes.