What Happened?
A number of stocks fell in the afternoon session after the U.S. administration announced a sharp escalation in trade tensions by threatening new tariffs on Canada.
The wider market sentiment turned negative after the White House announced plans to impose a 35% tariff on Canadian imports, sparking renewed fears of a trade war. This news prompted a sell-off across major U.S. indexes, including the S&P 500 and the Dow Jones Industrial Average, as investors grew concerned about the potential economic impact of escalating protectionist policies. The healthcare sector is especially vulnerable to such tensions due to its deeply integrated supply chains with Canada for pharmaceuticals and medical devices, meaning increased costs and potential disruptions.
Additionally, ongoing U.S. policy headwinds aimed at lowering drug prices and specific corporate challenges, like those faced by UnitedHealth Group, further compounded the sector's decline. As a result, the Health Care SPDR ETF (XLV) fell 1.0%, underperforming even as major indices pared some losses.
The stock market overreacts to news, and big price drops can present good opportunities to buy high-quality stocks.
Among others, the following stocks were impacted:
- Medical Devices & Supplies - Imaging, Diagnostics company Lantheus (NASDAQ: LNTH) fell 3.1%. Is now the time to buy Lantheus? Access our full analysis report here, it’s free.
- Medical Devices & Supplies - Cardiology, Neurology, Vascular company ICU Medical (NASDAQ: ICUI) fell 3.3%. Is now the time to buy ICU Medical? Access our full analysis report here, it’s free.
- Medical Devices & Supplies - Specialty company Haemonetics (NYSE: HAE) fell 3.4%. Is now the time to buy Haemonetics? Access our full analysis report here, it’s free.
- Surgical Equipment & Consumables - Diversified company CONMED (NYSE: CNMD) fell 3.7%. Is now the time to buy CONMED? Access our full analysis report here, it’s free.
- Healthcare Technology for Providers company Astrana Health (NASDAQ: ASTH) fell 3.3%. Is now the time to buy Astrana Health? Access our full analysis report here, it’s free.
Zooming In On CONMED (CNMD)
CONMED’s shares are somewhat volatile and have had 14 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful but not something that would fundamentally change its perception of the business.
CONMED is down 23.3% since the beginning of the year, and at $51.67 per share, it is trading 33.4% below its 52-week high of $77.54 from November 2024. Investors who bought $1,000 worth of CONMED’s shares 5 years ago would now be looking at an investment worth $708.88.
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