A recent fall survey by Natixis Investment Managers found that 74% of institutional money managers expect the market to improve in 2026. They cited a variety of reasons, ranging from the bursting of a tech bubble to geopolitics and macroeconomic factors. Currently, the Nasdaq Composite While the year is still rolling around until the date S&P 500 increased by about 1.7%.
Reforms are part of the investment landscape. We had one last year, and there have been eight corrections or bear markets in the last 10 years.
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While you can’t ignore them, you can prepare for them with stocks designed to zig when the market crashes. Here are two healthcare professionals who can help you do just that.
Two pharmaceutical giants, AbbVie (NYSE: ABBV) and Merck (NYSE: MRK )It’s more common than manufacturing medicine. They are both terrific defensive stocks. This means they make products that are in demand in all cycles, because they are just as important in a recession as they are in a bull market. However, their impact on a portfolio is more pronounced during recessions, when growth stocks struggle.
During the last few down cycles, both Abbavi and Merck stocks rose. In the 2022 bear market, AbbVie stock is up 24% for the year, while Merck is up 49%. That year, the S&P 500 ended down 18%. In 2018, while the S&P 500 fell 4%, AbbVie was down 1%, and Merck was up 40%.
On the other hand, both stocks tend to underperform in years when overall markets are strong. But the long-term numbers are generally in line with the S&P 500. They don’t just move in tandem with the large-cap benchmark. AbbVie stock has an average annual return of 15% over the past 10 years, while Merck is at 10%. For comparison, the S&P 500 has a 10-year annualized return of 14%.
A hallmark of a good defensive stock is its dividend, and both AbbVie and Merck offer strong dividends.
AbbVie raised its dividend by 5% last month to $1.73 per share on a yield of 3.10% just last month. This is the 13th year in a row that it has increased its dividend – it has done so every year since it split. Abbott Laboratories In 2013.
Merck pays a quarterly dividend of $0.85 per share for a yield of 2.99%. Like AbbVie, its yield is three times the S&P 500’s average yield of 1.13%. It has increased its dividend for 15 consecutive years.
