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Will ObamaCare kill the Bull Market?

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Both the Dow Jones Industrial Average (DIA) and the Standard & Poor’s 500 Index (SPY) have tripped in recent market action.

The bull market in equities, now longer than five years, have been very generous to many shareholders.  That is especially true for health stocks, especially those in the high technology sector with products at the retail level for consumers. But that could be coming to end due to The Affordable Care Act, or ObamaCare.

In recent trading, many healthcare stocks have fallen.

As an example, Lifepoint Hospitals (LPNT), a major hospital operator, is down for the last week and month of market action.  Many other healthcare stocks have fallen in trading, too.  Much of this has to do with the impact of Obamacare being felt on the healthcare sector.

Healthcare is about one-sixth of the American economy, its largest component by industry group.

As a result, it contributes significantly to the economic well being of the United States economy.  There is little doubt that The Affordable Care Act does not.  The most obvious indicator of this is that The Obama Administration has delayed or changed The Affordable Care Act more than thirty times.

Obviously, that was done in large part to help the supporters of ObamaCare in the November mid-term elections for the United States Congress.

If the Affordable Care Act was helping the American economy, voters would go for its supporters.  But The Obama Administration does not see that happening.  It is certainly not be the result in elections this year as ObamaCare supporters have lost in all.

Eventually this could show up in the stock market, destroying its gains.

That would be tragic for the global economy for many reasons.  The Dow Jones Industrial Average and the Standard & Poor’s 500 Index have been important leaders in the economic recovery from The Great Recession.  Should The Affordable Care Act end the bull market for stock, the impact on the overall economy would also be very bearish.

 

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