State Street Health Care Select Sector SPDR ETF

XLV

Valor de mercado US$ 45,8 bi

Shares of AbbVie, Eli Lilly and Gilead Sciences are trading at or near record highs.

Healthcare—particularly equipment and services and pharmaceuticals—offers investors diversification from AI, according to one report.

Tuesday, October 13, turned out to be a very interesting day for the healthcare sector. This is because UnitedHealth Group and Johnson & Johnson reported their Q3 2026 earnings results.

With the US population aging rapidly, three healthcare ETFs offer exposure to companies developing treatments, drugs and medical devices for age-related conditions.

Healthcare stocks have finally stepped back into the spotlight. After spending much of the past several years in the shadow of technology and AI, the sector has quietly emerged as one of the year's more compelling comeback stories.

U.S. equity markets were mixed this week, with technology and growth-related areas leading, while several defensive and rate-sensitive sectors moved lower. The NASDAQ 100 ETF rose 3.24%, and the S&P 500 ETF gained 1.29%, supported by strong performance in Technology, Communication Services, Health Care, and Industrials.

XLV offers a significantly lower expense ratio and a higher dividend yield compared to IBB. IBB has delivered higher one-year returns but carries substantially higher volatility and a deeper historical drawdown.

The State Street Health Care Select Sector SPDR ETF (XLV) offers significantly lower ownership costs, with an expense ratio of 0.08% compared to 0.58% for the Invesco Pharmaceuticals ETF (PJP). PJP provides concentrated exposure to 28 pharmaceutical stocks, while XLV holds 61 diversified healthcare companies.

Oncology spending is projected to reach $441 billion by 2029, but market growth is expected to slow as established therapies face generic and biosimilar competition. Several oncology blockbusters are also approaching loss of exclusivity, including Pfizer's Ibrance in 2027–2028 and Bristol Myers Squibb's Opdivo in 2028–2030. Overall, the oncology rally has been broad, but I believe several underappreciated companies still offer meaningful upside.

Political volatility should stay elevated even after Democrats retake the House this November, State Street Investment Management said. Republicans are still expected to hold the Senate, leaving little room for sweeping legislation.