Health Care Vote Critical to Coming Week
Updated from 6:00 p.m. EST
Updated to include House passage of health care reform legislation.
NEW YORK ( TheStreet) -- Investors may be suffering from health care fatigue, but the short-term direction of the stock market in the coming week was seen hinging on Sunday's vote.
The House of Representatives Sunday night passed the landmark, $940 billion health care overhaul.Passage was secured after President Obama and House Democratic leaders worked out a last-minute deal with antiabortion Democrats who had voiced opposition to the bill. The president appeased the group by issuing an executive order offering assurances that no federal money would be used for elective abortions. The latest version of the bill includes a handful of new taxes for investors on interest, dividends and capital gains in order to pay for the health care expansion. > > Bull or Bear? Vote in Our Poll Market observers argued that with a relatively light slate of economic and earnings releases, the market would take its biggest cue from the outcome of the vote. "If the House does vote on this, it will be a dissection of what it all means to the market," said Jay Suskind, senior vice president with Duncan-Williams. "We have the stealth capital gains taxes and what it will do to investing, the market's recent quiet rally, and health care stocks." Robert Pavlik, chief market strategist with Banyan Partners, said that passage of the bill would likely garner a negative reaction from the market due to headlines over the capital gains tax, although he argued that wise investors should view any pullback as a short-term one that provides a good entry point. "The health care bill and the capital gains tax news is more of the same noise that Wall Street shouldn't have to deal with," Pavlik said. "Personally, I'd be more concerned on the economy improving than an increase in capital gains. Focus on the longer-term trends, rather than the short-term Street noise." In addition, Pavlik called the latest version of the bill "watered down," which leads him to believe that health care stocks like Aetna (AET), Cigna (CI) and Humana (HUM) won't see a big move whether the bill is passed or not.
Select the service that is right for you!COMPARE ALL SERVICES
Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Upgrade/downgrade alerts
Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.
- Real Money + Doug Kass Plus 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV