Monday, October 30, 2006
Sector Spotlight: Drugs
The elections are right around the corner and it looks as if the Dems will punish the GOP. If so, there is a strong possibility that stem cell research will become "legal" again. Furthermore, companies like HAL, GD, MO and co. will likely live in the doghouse, indefinitely.
Frankly, a Democrat Congress will likely be very benign, considering they will have to "behave" -- in order to run a candidate for the Whitehouse in 2008. For now, I feel taxes will remain low and the market will not be hurt by a Dem takeover.
The real question is: What sectors will do the best under Democratic leadership?
Under the Clinton years, excluding the fucking technology banana's, Drug stocks outperformed. This time around, I feel traditional Drug stocks may underperform, mainly because of the high cost of prescription drugs and the prospect of Chuck Schumer putting his boot on big pharma's neck. Instead, I believe Biotech and Generic drug stocks will flourish under the Dems.
Beaten up stocks like BRL, TEVA, WPI, PRX, MYL may bounce. And, Stem Cell plays like STEM, CCEL, ASTM, GERN, VIAC, ACTC may become momentum plays.
Frankly, a Democrat Congress will likely be very benign, considering they will have to "behave" -- in order to run a candidate for the Whitehouse in 2008. For now, I feel taxes will remain low and the market will not be hurt by a Dem takeover.
The real question is: What sectors will do the best under Democratic leadership?
Under the Clinton years, excluding the fucking technology banana's, Drug stocks outperformed. This time around, I feel traditional Drug stocks may underperform, mainly because of the high cost of prescription drugs and the prospect of Chuck Schumer putting his boot on big pharma's neck. Instead, I believe Biotech and Generic drug stocks will flourish under the Dems.
Beaten up stocks like BRL, TEVA, WPI, PRX, MYL may bounce. And, Stem Cell plays like STEM, CCEL, ASTM, GERN, VIAC, ACTC may become momentum plays.
