2026 Global healthcare equities outlook: Innovation supports healthcare’s long‑term case

24 March 2026

Steven Slaughter, Lead Portfolio Manager

CJ Sylvester, Portfolio Manager

In 2025, global healthcare equities once again demonstrated their lower volatility profile. Early in the year, global equities experienced a meaningful correction as artificial intelligence (AI)-related stocks sold off and higher-than-expected US tariffs fuelled uncertainty among investors. During this period, healthcare equities proved more resilient, recording a noticeably smaller drawdown than the broader market. Although the sector trailed the rebound of global equities - despite both finishing in positive territory for the full year - we believe that the defensive characteristics of the overall healthcare industry, coupled with remarkable therapeutic innovations in the biopharmaceutical, MedTech, and tools sub-segments of this sector, will continue to be rewarded with capital appreciation over a full market cycle. Current valuations relative to the broader market make for an attractive entry point today, and periods like this tend to lead to outperformance for healthcare stocks over the long term.

Summary:

Regulatory and public policy changes were significant overhangs for healthcare in 2025. However, we believe that the passage of time has allowed greater visibility on several mitigating factors.
Within the biopharmaceuticals, MedTech and life science tools, and healthcare providers and services industries, we see abundant investment opportunities in 2026.
Demographic trends in healthcare, coupled with remarkable therapeutic innovations of this sector, will likely continue to be rewarded with share-price gains over a full market cycle.

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