Healthcare-related stocks are seeing notable gains during late-morning trading on Friday, with the advance coming on the heels of yesterday's healthcare reform summit in Washington.
Healthcare provider stocks are showing a strong outing, as reflected by the 1.3 percent gain being shown by the Morgan Stanley healthcare Provider Index. With the advance, the index is bouncing off of yesterday's two-week closing low.
Within the sector, Sunrise Senior Living Inc. (SRZ) and Tenet Healthcare Corp. (THC) are leading the way higher, advancing by 4.4 percent and 3 percent, respectively. Despite the upward move, the stocks remain rangebound as they offset recent losses.
Health insurance stocks are also moving substantially higher, driving the Morgan Stanley Healthcare Payor Index up by 1.1 percent. At its high for the session, the index was at its best intraday level in three weeks.
Coventry Health Care Inc. (CVH) is leading the way higher in the sector, posting 2.4 percent gain. The advance is helping shares recover from the two-month closing low set earlier this month. UnitedHealth Group Inc. (UNH) is also seeing a strong outing, rising by 1.8 percent to a one-month intraday high. The upward move in healthcare-related stocks came as congressional Republicans indicated they had little intention of heeding President Barack Obama's call to find common ground on health reform legislation following yesterday's healthcare summit.
GOP leaders from the House and Senate said they did not believe a compromise could be reached based on the framework of the bills that had passed the House and Senate and made up the backbone of the proposal Obama offered as a starting point for discussions at a health reform summit.
Senate Minority Leader Mitch McConnell, R-Ken., said that although there were Republican ideas incorporated into the bills, they remained fundamentally flawed.
"We don't think a 2,700 page bill, half a trillion dollars out of Medicare, raises taxes … drives insurance premiums up, is a good idea," he said. "What we think we ought to do is start over and go step by step and target the areas of possible agreement that we discussed in the meeting today."
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